Alongside inflation, we also need to take into consideration other pricing costs when we calculate our premiums. We’re continually checking our pricing against factors like the number and types of claims we receive, and changes to the cost of running our business, so that we can ensure we can be there for our customers at claims time.
For example, we’ve seen a significant increase in the recorded number of claims across New Zealand over recent years due to increases in the number of vehicle thefts and the severity and frequency of weather and natural hazard events. As a result of these events, reinsurers are changing how they view New Zealand and the costs being charged to insurers, which means AA Insurance’s reinsurance costs have increased significantly.