New data from the Consumer NZ Sentiment Tracker shows insurance has climbed to the fourth biggest financial pressure facing New Zealand households, trailing only housing, food, and household debt. This is a notable jump from sixth place eight months earlier.
Insurance Premiums Intensify Household Financial Pressures
Insurance premiums have surged across essential areas such as house, contents, car, and health coverage, intensifying financial strain on households. “We’re hearing more and more from consumers who feel they’re being priced out of essential cover,” said Rebecca Styles, Consumer NZ’s investigations team leader.
This upward trend threatens access to sufficient insurance and highlights underlying issues of cost, complexity, and perceived value in the market.
Declining Public Confidence Amid Growing Complexity
While the cost of insurance rises, public trust in the sector is moving in the opposite direction. Data from Consumer NZ reveals more people now say they distrust insurers than trust them—a reversal from previous years and part of a broader decline in confidence affecting multiple sectors including healthcare and energy.
“Insurance is meant to provide a safety net, but for many people, it’s becoming increasingly difficult to access,” said Styles. “When you add the complexity of policies and the lack of transparency, it’s easy to understand why trust in the industry is falling.”
The erosion of confidence raises concerns about the perceived value and role of insurance in New Zealand society, as fewer people feel they can rely on it during times of need.
Cost of Living Surpasses Climate Change in Public Concern
Financial pressures continue to dominate the national conversation. According to the same Consumer NZ survey, 65% of respondents cited the cost of living as their number one concern—a record high. Housing, food, and debt remain the top contributors, but insurance is now firmly part of the financial burden felt by most households.
Notably, concern over climate change has dropped in public rankings. Just 12% of New Zealanders now list it among their top three concerns, down from 17% a year ago. This shift reflects how immediate economic challenges are overshadowing longer-term environmental threats.
Climate Change Exacerbates Insurance Coverage Challenges
Climate change’s influence on the insurance market is becoming clearer, even as public concern declines. The rising frequency and severity of extreme weather events have pushed premiums upward, particularly in high-risk locations. Many New Zealand households are now either unable to afford insurance or being refused cover.
“Our upcoming report will highlight how the affordability of house and contents insurance impacts resilience in Aotearoa,” said Styles. Increased risk exposure leaves uninsured households more vulnerable.
Consumer NZ Calls for Industry Reform to Restore Trust
Consumer NZ is urging insurers to address value, transparency, and fairness as public trust wanes and financial burdens grow. The organisation warns that without changes, confidence in insurance could erode further, weakening its essential purpose.
The winter 2025 issue of Consumer magazine, due on 9 June, will examine the trust and affordability challenges in New Zealand’s insurance market. Meanwhile, Consumer NZ continues to support consumers with online guides for car, house, contents, and travel insurance.