Halfpenny was also the player of the Six Nations earlier this year as Wales defended their title and Gatland insists he has no equal in world rugby at the moment.
"It's deserved because the work he puts in is phenomenal," said Gatland. "The harder you work the luckier you get in terms of success and currently there's no better goalkicker in the world.
"He started on the wing but now there's no better full back in the world. Positionally he's got no equal and with the goalkicking you're expecting it to go over because that's how good he is."
Halfpenny himself highlighted the work of Neil Jenkins, his kicking coach for both the Lions and Wales, in helping him become the world-class player he is now.
"It's very overwhelming to hear the trust that he (Gatland) has in me," said the 24-year-old.
"It comes from hard work with kicking practice and I'm very fortunate to have a great kicking coach in Neil Jenkins.
"He was a fantastic kicker and without him I wouldn't be able to do what I do.
"But I'll keep trying to look for areas I can work on and improve in my game."