New Zealand’s insurance industry fell into deficit last year because of Christchurch earthquake claims.

Statistics NZ says the health and general insurance sectors had a $NZ429 million ($332 million) surplus in 2010 but slipped to a deficit of $NZ2.17 billion ($1.68 billion) last year when expenses rose 83% to $NZ2.71 billion ($2.1 billion).

“This increase was caused by the very large net claims expense incurred by insurance companies as a result of widespread earthquake damage to property,” the report said.

Insurers’ current assets rose by $NZ10.89 billion ($8.4 billion), or 231%, because of reinsurance recoveries but current liabilities, due within a year, rose 278% to $NZ10.65 billion ($8.25 billion) because of earthquake claims.