Kiwis paid $9b in premiums to the big insurers in 2017

The amount of money Kiwis paid to big insurers jumped by 7 per cent to over $9.3 billion last year.

The year to September figures were released by the Reserve Bank for the first time this week as part of its role as the prudential supervisor of the sector.

While the premium jump was much greater than inflation the amount of money people claimed from their insurer rose by more than 50 per cent to $8.19 billion.

The year included claims from the Kaikoura quakes which struck in November 2016.

The amount people paid out for life insurance remained relatively static rising just over $10 million to $2.26 billion while non-life insurance premiums rose from $6.5 billion to $7 billion during the year.

Payouts for life insurance increased from $1.26 billion to $1.33 billion while non-life insurance claims rose from $4.14b to $6.86b.

The jump in claims saw a squeeze on the bottom line profits of insurers with the after-tax profit for the big insurers falling from $898m to $532m over the year.

Bernard Hodgetts, the Reserve Bank's head of macro-financial stability said New Zealand's private insurance sector was relatively small by international standards.

"This reflects a number of factors, including the comparatively large role of government in the provision of social insurance services in New Zealand, and the small extent to which insurance products are part of New Zealand's retirement savings infrastructure."

The data covers 28 of the 88 licensed insurers in New Zealand but accounts for nearly 90 per cent of the assets and premiums.

The figures do not include the insurance provided through Accident Compensation Commission and the Earthquake Commission.