New Zealand local government insurer Civic Assurance plans to re-enter the property market by launching a new pool for its council shareholders.

Civic had to stop offering property cover in 2011 after the Canterbury earthquakes. Reinsurers covered most of its losses – now more than $NZ800 million ($669.17 million) – but refused to renew the program.

The company’s annual report says it will be “a number of years before Civic can rebuild its insurance portfolio to where it was”, but the company hopes to launch a property pool if it can get reinsurance.

This will help councils reduce long-term insurance costs.

Civic continues to offer other lines, including motor, and earns fees for administering the Local Authority Protection Program (LAPP), which covers councils’ underground assets, the professional indemnity provider Riskpool and superannuation schemes.

The LAPP is close to settling two large claims totalling about $NZ250 million ($209.11 million).

Civic is in arbitration with two of its reinsurers – R+V of Germany and AIG – and believes it will win both cases by the end of the year, the report says.

The company made a $NZ1.31 million ($1.09 million) loss last year, compared with a $NZ5.41 million ($4.53 million) loss in calendar 2011.

Civic retained losses of $NZ10.8 million ($9.03 million) from the September 2010 and February and June 2011 Canterbury earthquakes.

Reinsurance recoveries were $NZ820.25 million ($686.1 million) and the outstanding claims liability was $NZ829.31 million ($693.68 million) at December 31, the report says.

Premiums for Civic’s old uncapped reinsurance program were “very modest”, but after the reinsurers withdrew, no others would offer uncapped cover.

Civic secured property reinsurance last year but councils were not prepared to buy it without the company holding an A credit rating.