NZ General Insurance Market Update - January 2026

28 January 2026

A 2026 reset brings a year of positive change. As we are all now looking forward to 2026, our hope is for broader growth and certainty for all our businesses and households. Collectively, many businesses, families and individuals are working hard, resetting plans, and committing to the year ahead. We all wish to see our economy grow, demand to flow back, and investment ideas to be executed. A broadening of economic growth helps us all. Encouragingly, property experts broadly agree that house prices are likely to rise by around 5%, supported by lower holding interest rates and a renewed confidence stimulating activity in the market, with more willing buyers and sellers accepting the market cycle. And with stable monetary policy settings forming, it feels like the right time for the private sector to move forward, plan confidently, and begin investing.

We are beginning to see anecdotal evidence in the construction sector, with new projects getting underway. This observation, alongside existing product demands (exporters), tourism returning, and the rural sector, of course we should see some overall economic improvements filter through.

With an election scheduled for later this year (7 November), some uncertainty is inevitable. However, given lower interest rates and the increasingly positive signals emerging across our markets, we expect any election-related nerves to be largely contained.

The current Official Cash Rate sits at 2.25% (as of November 2025), with the next announcement due on Wednesday, 18 February 2026.

The consensus appears to be that, for now, interest rates will hold. Inflation data - and/or concerns about rising inflation versus low, slow economic growth and potential offshore shocks - are all key factors in determining the path of local interest rates and their impact in the second half of 2026.

The New Zealand Quarter 4 Annual Inflation Rate

The inflation rate has been revised up to 3.1 % Stats NZ , which sits outside the Reserve Bank’s target range of 1%-3% .

Contributors to recent inflation data are:

Power, council rates, and certain food groups.
Insurance Premiums are softening and, more broadly, not attracting inflationary pressures.

As mentioned above, many expect the Reserve Bank will hold rates for now. Experts expect to see inflation come back down and into the 2.5%-3% range as we progress through 2026. However, there is a possibility that the OCR will be raised again later in 2026 if inflation remains above or around the 3% mark.

As previously mentioned, we are seeing premium rates flatten out and soften in certain sectors of the New Zealand economy. Assuming no large-scale insurable events or losses, this trend is expected to continue well into 2026.

Generally, residential and domestic premium rates remain stable, while certain commercial premiums continue to soften, provided there is sufficient competition within the market. Stable premium rates, particularly for well-managed properties and businesses, remain essential for economic recovery.

Insurance trends:

Insurers will seek to stabilise margins against a backdrop of falling top-line growth.
The absence of large-scale weather events (fingers crossed), lower reinsurance costs, operational efficiencies, competition, and stable inflation are all important factors in Insurers offering price stability.
Reinstatement values should be reviewed to ensure your sum insured reflects current and adjusted replacement costs.
We expect insurers to pursue premium growth opportunities with a desire to improve their top-line premium pools, which is a positive and likely to drive increased competition across the industry.

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.