NZ General Insurance Market Update - August 2026

What has changed?

Energy and fuel pricing continue to be a key concern.

Oil prices remain inherently linked to the tensions between the United States and Iran, and it is difficult to identify a clear path toward de-escalation.

Perhaps the period before the United States mid-term elections in November will become even more influential for both policy decisions and market sentiment.

Changes or economic consequences for us to watch:

• The Reserve Bank has lifted the Official Cash Rate (OCR) from 2.25% to 2.50% on Wednesday, 8 July 2026.
• Many economists are forecasting two further interest rate rises this year. However, as mentioned in May, the challenge is balancing New Zealand’s soft economic backdrop against rising inflationary pressures caused by offshore energy-geopolitical tensions.

The recent OCR rise is largely seen as a response to higher inflation concerns and perhaps trying to stay in front of the inflation curve.

• The Consumer Price Index (CPI) in the last quarter ending Tuesday, 30 June 2026 did come in higher at 4.1%.
• We all know how much of this rise is generated from the energy-geopolitical issues overseas, disappointing for our local economy given the efforts everyone is making to turn the economic corner.
• The property market remains soft, especially across the North Island.
• As of Tuesday, 30 June 2026, Real Estate Services dropped 4.6%, contributing to the -1.5% in the overall non-tradeable inflation group.

Many expect the property market to remain subdued for the rest of this year.

The New Zealand Quarter 1 Annual Inflation Rate

The inflation rate remains at 4.1% Stats NZ, which remains outside the Reserve Bank’s target range of 1%-3%.

The contributors:

• petrol, up 20.1% (49.5% contribution to the 1.5% rise for all groups)
• other vehicle fuels and lubricants, up 47.7% (16.2% contribution to all groups)
• purchase of housing, up 1.6% (10.2% contribution to all groups).

Non-tradable inflation:

• Electricity is up 12.0% (17.0% contribution to the 3.4% rise for all groups non-tradeable)
• Local authority rates are up 8.8% (13.6% contribution to all groups non-tradeable).

General Insurance Premiums (excluding Life and/or Health-related insurance) remain stable to softening and with no significant pressures evident at this stage.

We continue to monitor large weather and natural disaster events that impact communities and can result in significant insurance claim costs.

How aibGROUP Can Help You Navigate the Current Insurance Cycle

By speaking with one of our insurance advisers about your circumstances and assets, we can tailor solutions that support your insurance needs and protect what matters most.

• Our team will present all available options, such as adjusting excess levels and providing expert advice tailored to your needs. The value of professional guidance, strong insurer relationships, and personalised service has never been more important. Contacting us is easy, and we’re committed to acting as your advocate, building a close, trusted partnership.
• We proactively review your cover and recommend any necessary changes without delay. Our experienced claims team operates independently from insurers, ensuring you receive the full benefits of your policy when it matters most.
• For buildings and homes, we recommend obtaining a professional insurance valuation. This helps eliminate guesswork from online calculators or reliance on outdated inflation estimates. A qualified valuer also provides an added layer of protection if your declared value is ever challenged.

Other ways we can add value to your insurance journey include:

• Access to fast-track claims processing with select insurers, and close collaboration with insurance assessors for non-fast-track claims, ensuring they are handled efficiently and correctly.
• We keep you informed with regular updates throughout the process.
• Referrals to professional insurance valuers at discounted rates through our partnership with NZbrokers.
• Years of experience and understanding of the local market, which has consistently delivered positive outcomes for our clients over the years.
• A strong team culture focused on continuous development, ensuring we stay current and proactive in an ever-changing insurance landscape.
• Community support through sponsorship and volunteering, reflecting the values we share with many of our clients and helping to strengthen our local partnerships.

Additionally, like many of our clients, we support local non-profit community organisations through sponsorship and volunteering, continuing to build those partnerships and connections.

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