New Zealand’s Earthquake Commission (EQC) has negotiated $NZ3.25 billion ($2.88 billion) of reinsurance at similar rates to last year, CEO Ian Simpson says in the annual report.

It paid $NZ40 million ($35.5 million) for reinsurance in 2010 but that doubled after the Canterbury earthquakes, for which reinsurers are forecast to cover about 80% of the estimated $NZ30 billion ($26.6 billion) insurance loss.

The reinsurance market has softened since due to an influx of new capital.

Mr Simpson says this year’s negotiations were 10% oversubscribed. The commission bought provision for one reinstatement should a second major event occur, and it increased cover from $NZ3.1 billion ($2.75 billion).

“Despite the impact of the Canterbury quakes, the EQC has benefitted from long-term relationships with reinsurers forged over 20 years, familiarity with our account resulting from personal contact and the superior geophysical and engineering information we have provided them to help carry out risk assessments,” he said.

The commission earned premium income of $NZ241.67 million ($213.9 million) in the year to June 30, up 125% after levies increased last year. It paid $NZ132 million ($117.2 million) for reinsurance, up 83%.

It paid $NZ1.8 billion ($1.6 billion) in claims and received $NZ1.3 billion ($1.15 billion) in reinsurance.

The EQC has paid $NZ5.7 billion ($5.06 billion) in Canterbury claims since the first event in September 2010 and recovered $NZ1.8 billion ($1.6 billion) from reinsurers, from an anticipated recovery of $NZ4.5 billion ($4 billion).

The outstanding claims liability fell 23% to $NZ6.66 billion ($5.91 billion).

Chairman Sir Maarten Wevers reports “significant progress in apportioning the liability between the EQC and private insurers for damage from the 16 separate Canterbury events”.

The commission received more than 7000 earthquake claims during the year, 1328 landslip claims, 26 for hydrothermal activity, 26 for volcanic eruption and 24 for tsunami.

The Cook Strait earthquakes came after the financial year ended. The EQC estimates its liability from the July 21 event will be up to $NZ100 million ($88 million).