NZ Insurers Slammed with New Levy as Regulatory Burden Mounts

New Zealand insurers are facing multiple regulatory challenges, including a proposed prudential levy that could add to their already substantial cost burden.

The RBNZ's consultation paper estimates the levy would recover $209 million over three years, with insurers accounting for $81 million (39%) and deposit takers picking up $113 million (54%).

The proposed design of the levy falls hardest on smaller and specialist carriers, which underwrite niche and hard-to-place risks.

RBNZ Assistant Governor Angus McGregor said that the levy's rationale is to shift where the money comes from, noting that similar approaches are used in Australia, Canada, Ireland, and the UK.