The council has various insurance policies in place, including for the Local Authority Protection Programme for underground reticulation and river control/protection assets. (Pictured is flooding at Spring Creek on 12 April, 2024.) Photo: RNZ / Samantha Gee
Marlborough District Council needs to find more than half a million dollars to cover its insurance premiums for the current financial year, after they increased by more than expected.
Chief financial officer Geoff Blake said the council had budgeted for a 20 percent increase in insurance costs, but the final figure, finalised at the end of June exceeded that.
An additional $548,000 was now needed to cover the increased premiums, which came in at $5.9 million for the 2024-2025 year.
It was a $1.5m increase on the insurance premium for 2023-2024, which was $4.4m.
Blake said insurance renewals for this year were challenging given changes in insurers' risk assessments for the New Zealand market.
"Marlborough district is facing the same insurance premium cost pressures as other councils around New Zealand. These costs are outside our control, although we have been able to make some savings by reducing our insurance cover in some areas."
As an on-going operational cost, it was recommended the increase was funded from rates, Blake said.
That means Marlborough rates would increase this financial year from 12.96 percent to just over 13.6 percent.
The council has various insurance policies in place, under three broad categories:
- The Local Authority Protection Programme for underground reticulation and river control/protection assets
- Material damage insurance covering commercial and non-residential structures
- Other insurance including motor vehicles, marine, liability and plantation timber.
The council will hold an extraordinary meeting next Thursday to address the rising insurance premiums.
