Flood costs climb as more rain forecast

Insurance claims after last week's North Island floods are mounting and payouts could enter the tens of millions of dollars, but the Insurance Council says much of the real cost is not as obvious.

The council's chief executive, Chris Ryan, said it was still too soon to say how many private claims would be made after the flash floods in Orewa, Coromandel, Bay of Plenty and Hawkes Bay.

The MetService predicts more heavy rain for today in the Coromandel and Mr Ryan said the number of claims was expected to continue to rise this week.

"So many of these areas also have ongoing issues.

"There's more rain to come and slips are still happening because land has not stabilised.

"The claims will certainly be in the hundreds, but I can't say whether they'll go in to the thousands yet.

"We had 150 [claims] out of Otago - that was last week. I'm aware in the Coromandel there are a couple of houses which are pretty much destroyed and it seems there are more that are sliding down in other areas."

The MetService yesterday issued a new severe weather warning for another period of intense rain for the Coromandel Peninsula, expected to arrive today.

Thunderstorms were forecast for the north and east of the North Island from Kaitaia to Wairoa, lasting until tomorrow.

The warning said because the soil in affected areas remained soggy, the rain today and tomorrow was likely to produce localised flash floods and surface flooding.

Communities and their councils were advised to check all culverts to ensure they were clear of debris.

The MetService advised against non-essential travel in north-eastern areas of the North Island.

Mr Ryan said it was clear that climate change was resulting in increased monetary costs to the community.

Insurance council records showed that in 1968 just one single storm hit the country, which resulted in the sinking of the Wahine.

It was seven years before another storm of the same magnitude struck.

By comparison, in the nine years to the end of last year, 69 storms inflicted significant damage throughout New Zealand. The Manawatu floods of 2004 cost $120 million in private insurance claims, Mr Ryan said.

Added to that were losses to the local export trade, estimated at $100 million.

A further $100 million was spent rebuilding infrastructure such as bridges, roads and power lines.

In many instances local or central Government did not insure itself against events such as flash floods, preferring to cover costs as they arose.

"The losses to the community and economy are far greater than private insurance cover," Mr Ryan said.

Rural communities and small settlements could be ruined by just one flood event.

Up to 40 per cent of homes in such areas lacked adequate insurance cover or were uninsured.

Stock losses in Coromandel and Hauraki last week appear to have been minimal, said Waikato Federated Farmers president Peter Buckley.

Many farmers in those areas were experienced and well prepared for sudden rises in river levels, so shifted stock in advance.

Thames Coromandel District Council spokesman Peter Hazael said road engineers would investigate damage around the region this week.

The previous significant flood was in January, which resulted in a $1.5 million bill for roading repairs around the district.

Te Kaha land owner Maraea Chadwick said she thought the increased prevalence of floods in the Coromandel and around the East Coast was being caused by the cyclical planting and clearing of pine forests every 20 to 30 years.

"Each one of those trees sucks up 20 gallons of water each day.

"When you clear tens of thousands of them you're talking a lot of water that is no longer being retained or absorbed.

"Plus there's the increased erosion factor because when you cut them down there's just a bare bank of ready-made silt and debris."

Counting the cost

* Private insurance cost of recent storms in New Zealand (does not include local or central Government property such as roading infrastructure or property that is uninsured).
* Manawatu floods (2004): $112 million.
* Thames weather bomb (2002): $30 million.
* Queenstown floods (1999): $51 million.
* Cyclone Bola (1988): $58 million.
* Wahine storm (1968): $42 million (excluding cost of the Wahine).

Weather warning

* Heavy rain predicted today for Coromandel Peninsula, with localised flash floods.
* Thunderstorms in north and east from Kaitaia to Wairoa until tomorrow.
* Weather "more normal" after tomorrow.