The company is mutually owned
NZ to back insurer AMI despite budget pain
WELLINGTON, April 7 (Reuters) New Zealand government has agreed canada goose coats to provide financial support for AMI, the country second largest residential insurer, after two major earthquakes threatened to uk canada goose outlet deplete its capital, Finance Minister Bill English said Canada Goose Parka on cheap canada goose jackets Thursday.
English said the potential buy canada goose jacket cheap cost for the government might be as much as NZ$1 canada goose uk shop billion ($775 https://www.cagooseclearance.com million), straining the budget further, but would not scupper the government plan to return the canada goose coats on sale budget to surplus.
provides a financial Canada Goose Coats On Sale backstop for policy holders so the rebuilding of Christchurch is not jeopardised by potential solvency or liquidity canada goose uk black friday issues and so canada goose black friday sale confidence is maintained in the insurance sector, he said in a statement.
A funding shortfall is canadian goose jacket threatening the insurer as a result of a flood of claims in the canada goose clearance wake of two devastating earthquakes in the South Island city of Christchurch in the past year.
support package will canada goose uk outlet give AMI the time to seek a market solution, uk canada goose English said.
Official estimates of the cost of the Christchurch earthquake on Feb 22 and an earlier canada goose store quake in the region last September are around NZ$15 billion ($11 billion), about 7 percent Canada Goose sale of the economy.
The buy canada goose jacket AMI package would be called on only as a last resort if AMI own reserves have been exhausted unless the government believes it is in the public interest to take control sooner, he added.
Christchurch based AMI has 485,000 policy holders and 1.2 million policies across the country. The company is mutually owned, meaning that its customers are also cheap Canada Goose its owners, limiting its ability to raise capital.
It said it cheap canada goose uk had more than NZ$350 million in reserves but could not allow uncertainty about Canada Goose Jackets its financial position to remain.
could not allow such concerns to mount and it was for Canada Goose Outlet this reason that we asked government to stand behind us during this difficult period, Chief Executive John Balmforth said in a statement.
will not draw down on the capital facility from government unless we have to.
In Christchurch, its home base, it has more than 85,000 policyholders canada goose factory sale with 225,000 policies or about 35 per cent of the residential insurance market in the city.
is an unusual situation requiring a special response, English said.
If the package is called on, it would involve the government investing up to NZ$1 billion in AMI, Canada Goose online with the right to take ownership and assume control of the company if it needs to, the canada goose clearance sale finance minister said.
English said the government potential liability was uncertain and would depend on the extent of claims on the company.
a range of estimates and they range from zero, that is the company may be able to meet all the claims, through to about NZ$1 billion more claims than they are able to meet, English told reporters.
Asked if the potential cost would Canada Goose Online delay the government planned canada goose return to budget surplus by 2015/16, English said it would be another headwind: will not knock us off track, he said.
New Zealand insurance sector is dominated by Australian owned companies, including IAG and AMP. (Reporting by Gyles Beckford, Adrian Bathgate; Editing by Balazs Koranyi).