Council insurance deal 'good news'

Grant McKenzie
Grant McKenzie
The Dunedin City Council has secured ''significantly'' improved insurance cover for $3.4 billion of ratepayers' assets after seeking a better deal in London, it has been confirmed.

Council group chief financial officer Grant McKenzie told the Otago Daily Times the council's insurance cover had been renewed, within budget and with improved terms, in recent days.

That followed Mr McKenzie's trip to London in April, where he met 15 representatives from specialist insurance market Lloyds of London, including from All Blacks' sponsor AIG.

The trip had aimed to improve the scope and cost of the council's existing cover, while spreading it between New Zealand and international insurers.

The council was left without insurance for at least $1.6 billion of its assets following the Canterbury earthquakes, after international reinsurers refused to cover underground assets and the council refused to pay inflated premiums for above-ground assets.

Mr McKenzie said, as a result of his trip to London, the council now had direct backing from international insurers through the Lloyds market. That included expanding the scope of what was covered, although Mr McKenzie was reluctant to divulge details yesterday.

''The market moves for and against you at times.

''It appears the market has moved for us, significantly,'' he said.

Details of the new deal would be disclosed in a report being prepared for the next council finance committee meeting on July 28, he said.

''It is a good news story.''

- chris.morris@odt.co.nz

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