Extreme weather is something that no business can prevent, but they can take precautions to deal with the damage that it brings. One means of doing this is to take out comprehensive business insurance, which will pay out in the event that assets and other property is damaged during an event.
One of the current threats to New Zealand businesses is El Nino. This is a global phenomenon that brings with it changes in conditions affecting different countries in a variety of ways.
The National Institute of Water and Atmospheric Research (NIWA) explains that one of the biggest impacts on New Zealand is strong and frequent winds. During the winter months, these generally originate from the south and bring with them colder conditions, as well as the threat of drought.
The outlook for El Nino
The MetService has warned that there is already evidence of an El Nino, as warmer than usual sea temperatures have been detected in the Pacific Ocean. MetService meteorologist Georgina Griffiths noted that temperatures are currently at levels not seen since the El Nino of 1997-98.
She revealed that conditions suggest that moving into the latter part of the year, winds will start to move in a westerly direction and dry out large areas of land. At present, the group believes that El Nino will continue into early next year and will remain strong for at least the remainder of the year.
Farmers urged to exercise caution
Agricultural businesses are among the worst affected by El Nino conditions. Ms Griffiths has already encouraged the nation's farmers to make sure they are taking steps to protect themselves, which may include taking out some form of business insurance.
"While El Nino effects tend to diminish as you move away from the tropics, New Zealand has shown clear impacts from strong El Nino events in the past. We urge farmers to investigate what their typical El Nino response is," she remarked.
NIWA compiled a report following the last major El Nino titled 1997/98 El Nino event – Impacts, Responses and Outlook for New Zealand. It included estimates from the Ministry of Agriculture and Forestry, which suggested that the cost of the drought on farm gate returns had reached $256 million for the 12 months to June 30 1998. This was followed by another year of losses totalling $169 million, showing that the effects of extreme weather can persist for considerable amounts of time.
About the AuthorName: Kim Matthews
I’m the Leader Business Development & Sales for Rothbury’s Hawke’s Bay branch. I commenced my insurance career in 1980, have an insight in to how underwriters and assessors work and I’m a business owner myself - all great…
I’m the Leader Business Development & Sales for Rothbury’s Hawke’s Bay branch. I commenced my insurance career in 1980, have an insight in to how underwriters and assessors work and I’m a business owner myself - all great skills and experience that make me the broker I am.
I love dealing with people and I’m passionate about insurance!Close