A Year in Review

There are very few people who have the experience and passion for insurance of NZI’s acting executive general manager Karl Armstrong. Having led the NZI team between 2008 and 2014, Armstrong brings a wealth of knowledge and tenure as he steps in to run the business while a new EGM is recruited. 

Travis Atkinson is leaving the business.

Armstrong was humbled to receive a Lifetime Achievement Award at the ANZIIF Awards last month – an accolade he says is “suburb acknowledgement of my life within the insurance industry”. 

“After 46 years in insurance I still get up in the morning excited about the work we do to make a difference. I was truly blown away for being honoured for just doing my job, something I love.” 

For Armstrong, a highlight of 2017 has been seeing how teams responded to the unprecedented number of natural disasters during the year. “It is testament to the sustained hard work of our team during an extremely challenging year. We responded fast and helped customers with the reinstatement of their lives.”  NZI is on track to have completed 80% of Kaikoura claims by the end of December. “We learned a lot of lessons from Canterbury which have ensured a quicker and more streamlined approach to Kaikoura claims settlements.” 

NZI was awarded Insurer of the Year at the recent ANZIIF Awards. The judges praised NZI for its forward-thinking, relationship-first approach and impressive disaster response process.

Armstrong say NZI has spent a lot of time over the last year scrutinising the environment to prepare for the future. “We’ve been challenging ourselves to broaden our thinking as we know customers’ needs and preferences are changing. We’re focused on being the next-generation insurer by innovating to offer more individualised, more flexible, and more responsive products and services.” An example of this is NZI Total Development – a new commercial product for developers which is a first for New Zealand. It gives comfort that insurance is in place for the whole development and stops the need to negotiate at each stage, while also helping developers secure funding. It is truly customer-focused. 

Looking back over the last 18 months, Armstrong says a key focus for NZI has been how it adapts and evolves to the changing market. “Disciplined underwriting is the key to turning an unsatisfactory result around. We must have a sustainable and profitable business if we are to remain relevant to both brokers and customers.” NZI has remained committed to a long-term, New Zealand-wide approach, providing cover in areas of high risk. To do that it has increased prices and placed a renewed focus on risk that doesn’t generate returns. “This will enable us to continue to provide cover in all regions our customers are, who expect us to remain,” he says.  

As NZI looks to the future there are a number of key trends shaping the market, forcing both underwriters and brokers to review their approach. While not a new problem, New Zealand’s level of underinsurance was recently highlighted by the Kaikoura earthquakes. “Underinsurance presents a real risk to our customers, and we must continue to educate them around the need to select a sum insured that allow them to survive an unexpected event,” says Armstrong.

The challenge that climate change presents to the industry is gaining momentum – but it has been on NZI’s mind for many years. “This is an important issue for our market which will not be solved overnight. There will be locations in New Zealand challenged by floods, storms, tidal changes and erosion, and this will put pressure on affordable, available insurance.” 

As complexity increases and risks change, the role of the Broker has never been more relevant, says Karl. “The advice model will continue to play a part, but the responsibility is on brokers to show the value-add they provide.” A majority of SMEs prefer to insure through brokers because of the customization required – and increasingly sound advice will be sought and valued. 

NZI, backed by IAG, is well placed for the future, says Armstrong. “We have a saying – NZI is 158 years young. We’re here for the long term – and it’s been a privilege to have been on that journey for 46 years.”

December 2017

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