Coronet Peak ski lodges face a sharp hike in insurance premiums following the failure of Queenstown insurance company Western Pacific. The clubs’ premiums have increased from $7000 to $9000, according to the clubs’ presidents.
“Unsustainable” premiums charged by the insurance company – which was liquidated in April - caused the cost increase for insuring the Wakatipu and Otago ski club lodges, the Insurance Council of New Zealand said.
When contacted by the Otago Daily Times, council chief executive Chris Ryan said the clubs’ premiums were rising because they had re-insured at “market prices” after Western Pacific went under this year.
“Basically, Western Pacific was not a part of the Insurance Council and their underpricing meant that a lot of people … have found it more expensive because they chose the cheapest option, which was completely unsustainable,” he said.
Previously insured under Western Pacific, both ski clubs had trouble finding insurers willing to provide coverage, but are now insured by New Zealand Insurance.
A spokesman for Rothbury Insurance Brokers – brokers for the Otago Ski Club – said in the wake of the Christchurch earthquake, insurers were less likely to take on “high-risk” jobs.
“Ski clubs are only occupied for part of the time each year, and so are more at risk of arson or burglary … so that would put it in a higher risk category,” Rothbury business development and sales leader Chris Hughes said. “Following the Christchurch earthquake, insurance across the board is going to be more expensive, and also insurers are certainly looking at the type of business that they write.”