Natural Hazards Insurance Act
From 1 July 2024 our new governing legislation, the Natural Hazards Insurance Act 2023 came into effect. This Act modernises and replaces the Earthquake Commission Act 1993, and sets our primary objective, to reduce the impact of natural hazards on people, property and the community.
Our new name – Natural Hazards Commission Toka Tū Ake
From 1 July, the Earthquake Commission Toka Tū Ake became the Natural Hazards Commission Toka Tū Ake.
Our new name better reflects the range of natural hazards we provide cover for, including tsunami, landslides, volcanic activity, earthquakes and geothermal activity. It also represents the role we play in supporting New Zealanders to understand those hazards, and to both prepare for and recover from natural hazards when they occur.
The differences between NHCover and EQCover
The following information summarises some of the ways cover has changed or been clarified in the Natural Hazards Insurance Act 2023. It is not intended to be a comprehensive list of the changes. For more information please refer to the About natural hazards cover webpage, or the relevant Act.
EQCover or NHCover
When making a claim, the date the natural disaster damaged first occurred will affect whether a claim is subject to the Natural Hazards Insurance Act 2023(external link), or the Earthquake Commission Act 1993(external link).
|
EQCover |
NHCover |
| Claims for damage that first occurred before 1 July 2024 | Claims for damage that first occurred on or after 1 July 2024 |
| Subject to the Earthquake Commission Act – described in schedule 1, section 3 and 4 NHI Act. (external link) | Subject to the Natural Hazards Insurance Act – described in schedule 1, clause 2 of the NHI Act.(external link) |
Building cover cap
The building cover cap is the maximum amount that we can pay for a building claim. The building cover cap is generally up to $300,000 in both the NHI Act and the EQC Act. However, the NHI Act has a more detailed description of the calculation, and clarification around how it works.
|
EQCover |
NHCover |
| Building cover cap is currently $300,000 plus GST | Building cover cap is currently $300,000 plus GST |
| EQC Act – section 18(external link) | NHI Act – section 35 – 37(external link) |
Services
The list of essential services that are covered have been updated, and now includes heating.
|
EQCover |
NHCover |
| Water supply, drainage, sewerage, gas, electrical, and telephone services are covered. | Water supply, drainage, sewerage, gas, electricity, heating, or telecommunications are covered. |
| EQC Act - section 2(external link) | NHI Act – section 12(external link) |
Land cover cap
The land cover cap is the maximum amount that we can pay for a land claim.
The way that the value of retaining walls, bridges and culverts is decided when calculating the land cover cap has changed in the NHI Act, and an additional limit has been applied.
|
EQCover |
NHCover |
| Land cover cap uses indemnity value for retaining walls bridges and culverts. | Land cover cap uses undepreciated value for retaining walls, bridges and culverts, to a limit. |
| No separate limit is specified in the EQC Act. | There is a limit of $50,000 plus GST for all retaining walls, and $25,000 plus GST for all bridges and culverts. |
Read more information about the land cover cap calculation on our About natural hazards cover webpage.
Retaining walls, bridges and culverts
In both the NHI Act, and the EQC Act we provide limited cover for:
- Retaining walls that support or protect your home, insured separate buildings, and insured land, and are within 60m of your home.
- Bridges and culverts that are located on the land that is within 8m of your home and insured separate buildings, or on the land under or supporting your main accessway up to 60m from your home.
The NHI Act now allows for some retaining walls, bridges and culverts to be covered when they aren’t located within the property boundary. They might be covered when they are located outside of the property boundary if the insured homeowner has an insurable interest in them. The insured person may have an insurable interest through a licence to occupy, encroachment licence, or similar document that establishes an insurable interest.
|
EQCover |
NHCover |
| Retaining walls, bridges and culverts are only covered if they are located within the property boundary. | Retaining walls, bridges and culverts may be covered if they are located outside of the property boundary, as long as the insured homeowner has an insurable interest in them. |
| EQC Act – section 2 (external link) | NHI Act – section 18 (external link) |
Excess calculations
The NHI Act simplifies excess calculations and introduced a flat rate excess for building and land claims.
|
EQCover |
NHCover |
| Building claim excess - 1% of the total settlement amount, with a minimum of $200 to a maximum of $3,450 per insured home. | Building claim excess - $500 per insured home. |
| Land claim excess - 10% of the total settlement amount, with a minimum of $500 per insured home, to a maximum of $5,000. | Land claim excess - $500 per insured home. There is a maximum excess of $5,000 for buildings with more than 10 insured homes. |
| Earthquake Commission Regulations – regulation 4(external link) | NHI Act – section 31 (building)(external link) and section 39 (land)(external link) |
Read more information about the excess that applies to your claim on the About natural hazards cover webpage.
Exclusions/what is not covered
The list of property that is excluded from natural hazards cover has changed, and been made clearer.
|
EQCover |
NHCover |
| EQC Act - schedule 2(external link) | NHI Act - schedule 2(external link) |
Mixed-use buildings
The criteria used to decide whether a building with a mix of uses (such as a commercial building with residential apartments) is entitled to have natural hazards cover for the whole building, or only part of the building, has changed. Under the NHI Act, more buildings will meet the 50% threshold, and be eligible to have NHCover for the whole building.
For buildings that don’t meet the criteria to receive cover for the whole building, the NHI Act now includes proportionate cover for any common and joint property.
|
EQCover |
NHCover |
| EQC Act – section 2 (external link) | NHI Act – section 8 (external link) |
A better experience for homeowners
One way we are improving the experience of homeowners under the new Act is by clearly defining their rights in a new Code of Insured Persons’ Rights, and offering a new dispute resolution service for NHCover claims.
A Code of rights for insured people
The standard of service you can expect when you make a natural hazards insurance claim is set out in the Code of Insured Persons’ Rights. The Code applies to any interactions from 1 July 2024 about new or existing natural hazards cover claims. NHC Toka Tū Ake, or anyone working on our behalf, must follow the Code.
NHCover Dispute Resolution service
If a homeowner is unhappy with the outcome of their claim, they can make a complaint to us, their insurer, take the dispute to court or raise a complaint with the Ombudsman.
From 1 July homeowners will also have access to the NHCover Dispute Resolution service. This free, independent service is provided by Fair Way, and is designed to support homeowners to resolve disputes about the outcome of NHCover claims.