Kia ora koutou katoa,  It’s hard to believe a year has passed since the country experienced the devastating impacts of the Auckland Anniversary Weekend floods and Cyclone Gabrielle.

The combined force of these tragic and traumatic events caused major disruption to the lives and livelihoods of almost 5,000 of our clients and Members. In response, every employee across FMG (our ‘One Team’) pulled together to deliver the most significant recovery effort in the Mutual’s 119-year history, larger than both the Canterbury and Kaikōura Earthquakes combined. In what has been a tremendously challenging year for our clients and Members, I am extremely proud of everyone at FMG for their collective efforts in responding when we were needed most.

Despite the challenges, and thanks to your ongoing trust and support, FMG continues to grow and prosper – delivering to our ambitions of being a bigger and better Mutual. In December, our Rural market share surpassed the 55% threshold for the first time ever. Growth in the Lifestyle segment is also at an all time high with a market share of 23.5%, whilst our Residential and Commercial market share remains stable in what continues to be a tough environment for both households and businesses across Aotearoa/New Zealand. Given the external headwinds and uncertainty that continue to prevail across all segments, these are excellent results. Challenges do remain, including levels of on-farm profitability, and whilst the overall level of inflation experienced on and off-farm remains high, it is encouraging to see signals emerging which suggest that inflation may have peaked.

In such an environment, the affordability of insurance remains top of mind for FMG. It underpins our Purpose of delivering ‘a better deal for rural Aotearoa/New Zealand’ and we’ve been working hard to identify initiatives that will sustainably reduce our operating expenses. It’s part of our commitment to increasing our efficiency, enabling FMG to be a resilient and sustainable insurer that is fit for the future. As a mutual, we aim to be profit making, rather than profit maximising. Striking the right balance between meeting the needs of our clients and Members today and enabling FMG to be there for another 119-years to meet the Advice and Insurance needs of future generations of farmers and growers.

Any profit FMG does make is either invested into delivering our Vision of ‘helping to build strong and prosperous rural communities’ through FMG’s support of over seven hundred events and sponsorships annually (including dog trials, shearing competitions, scholarships and sponsorship of FMG Young Farmer of the Year); or it is added to the Mutual’s capital reserves in support of the continuing stability and growth of the business. Consistently meeting and/ or exceeding the Solvency requirements set by the Reserve Bank of New Zealand is a key measure of FMG’s resilience.

Looking at the wider rural economy, despite a number of continuing challenges, it’s encouraging to see several green shoots of optimism starting to emerge. Horticulture NZ is estimating a 12% increase for this year’s apple and pear crop, with cherry growers also upbeat. The decision to increase the size of eligible workers within the Recognised Seasonal Employer (RSE) scheme and the launch of a new $1.2 billion Regional Infrastructure Fund all providing positive news for the sector.

Wishing you all the very best for 2024.

Kind regards / Ngā mihi,

Adam Heath

Chief Executive, FMG