To improve consistency in the macroeconomic accounts, Statistics NZ is further revising its treatment of the exceptional insurance and reinsurance claims that resulted from the Canterbury earthquakes occurring from September 2010:
- Insurance and reinsurance claims from these earthquakes will no longer affect the investment income attributed to overseas owners of New Zealand insurance companies. This will ensure we treat these transactions consistently across our macroeconomic statistics.
- The transactions affected by the latest change cover the September 2010 to June 2011 quarters, with the largest effect in the March 2011 quarter. The change in treatment will decrease national disposable income and national saving by $650–$750 million in the year ended March 2011, and increase the current account deficit by the same amount. Quarterly gross domestic product is unaffected by this change.
- This change is linked to an earlier decision to treat the Canterbury earthquake insurance and reinsurance claims as capital transfers to reflect the exceptional nature of the earthquakes. Subsequent consultation with other agencies, including the International Monetary Fund and US Bureau of Economic Analysis, clarified that international best practice is to also apply this treatment to the measurement of insurance company operating surplus attributed to foreign direct investors.
This paper discusses the impacts of this decision.
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ISBN 978-0-478-37789-7 (online)
Published 28 August 2012