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Tower seeks action on public’s ‘dim view’ of industry

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New Zealand insurer Tower says the insurance sector should take clear action to improve its standing following inquiries showing the general public takes “a dim view” of the industry.

Financial services reviews have included the Hayne royal commission in Australia and a conduct and culture review by the Reserve Bank of New Zealand (RBNZ) and the Financial Markets Authority (FMA).

“We are keen to see all insurers respond to the conduct and culture review with action, not rhetoric. Collectively we can, and must, do better,” Chairman Michael Stiassny told the Tower annual meeting in Auckland today.

Mr Stiassny says the conduct and culture review did not take into account the negative public perception impact on the industry flowing from the state-owned Earthquake Commission’s (EQC) response to the Canterbury earthquakes.

“One suspects it was, and continues to be, significant,” he said. “If the same standards of customer care and engagement that are being applied to the private sector were applied to EQC and other agencies that form part of the Canterbury recovery, it would be found severely wanting and not at all customer centred.”

Dame Silvia Cartwright is currently leading a public inquiry into the EQC and is due to deliver a final report to the Governor-General by the end of the month.

Mr Stiassny says an EQC that delivers fair customer outcomes would have a significant impact on restoring New Zealanders’ trust in the industry.

“A true step-change in conduct and culture would see the industry join forces with the Government for an honest and transparent appraisal of the EQC and forge an agreement on a sustainable model for the agency.”

Mr Stiassny says Tower has taken the low esteem in which the industry is held “to heart” and is acting to improve performance.

“The board has already received and endorsed Tower’s own conduct and culture review, and while some aspects of our practice need further investigation our undertaking is to ensure any shortcomings are improved,” he said.

Tower’s business performance for the four months to January 31 had shown positive momentum in line with expectations, CEO Richard Harding also told the meeting.

Gross written premium in the core New Zealand book, including the contribution from its Youi portfolio acquisition, increased 11% over a year earlier. Total GWP rose 8%.