Following the North Island flooding and Cyclone Gabrielle, the Government announced a new categorisation framework for flood and landslip damaged properties.
If your property has been affected by this Land Categorisation, you may have ongoing questions about how this will impact your insurance.
The information and table below provide an overview of our approach to the new Land Categorisation framework and what each category could mean for your home insurance cover.
Some councils have advised property owners of a ‘provisional’ or ‘indicative’ category for their property, or area where their property is located, which will then be confirmed after consultation.
Provisional or indicative categorisation will not cause any change to your existing insurance cover, and any open weather-related claims will be progressed as normal.
However, we still consider the identified flood risk and land slip hazards of your property that could impact the terms and conditions of your cover, including the premium you pay and the excess. This is part of our normal process to evaluate the risk, for any insurance cover provided.
If your property is confirmed as Category 3, we will reach out to you to discuss what will happen to your insurance.
If your property is confirmed as Category 2A, 2C or 2P, we will contact you approximately six to eight weeks prior to your policy’s annual renewal regarding changes specific to your cover.
There will not be any changes to personal vehicle or boat insurance cover based on the categorisation of the property they are kept at.
Open weather-related claims will be progressed as normal. For more information on the individual categories, please refer to the table below.
The definitions and categories in the table below are taken from information provided by the Government.
The repair of the property to its previous state, before the damage occurred, is all that is required to manage the future severe weather event risk.
For example, there is minor flood damage to repair but no need for significant redesign or retrofitting.
If you have an open claim for damage from the weather events, the normal claim and post-claim policy review processes will be followed.
If you have received a cash settlement, you should go ahead or continue repairs to your property.
Your insurance won’t change based on your property being placed into Category 1. However, we still consider the flood risk and land slip hazards of your property that could impact the terms and conditions on your policy including the premium you pay and the excess.
This is part of our normal process to evaluate the risk, then determine the terms and conditions for any insurance cover provided, as we do throughout New Zealand.
If there are any changes to your insurance for any reason, we will contact you directly.
Community level interventions are effective in managing future severe weather event risk.
Local government will repair and enhance flood protection schemes to adequately manage the risk of future flooding events in the face of the effects of climate change.
If you have an open claim for damage from the weather events, the normal claim and post-claim policy review processes will be followed.
Properties in Category 2C have been identified as requiring intervention to manage future risk of damage from future severe weather events, this means your insurance may change at your policy’s next annual renewal to reflect the existing risk.
These changes could include:
If you have contents insurance for belongings kept at the property, these changes may also apply to that policy.
We will contact you approximately six to eight weeks ahead of your home policy renewing about the changes to your home policy more specifically.
Community-level interventions
We will monitor the progress of intervention works in each area and review the terms and conditions on your policy when the community-level interventions are complete.
Repairing your property
The repair work to your home needs to be completed in a reasonable timeframe. We’ll work with you and your individual circumstances on what this means for you.
What we need from you
Please let us know if you intend to delay the repairs to your home until the community flood or landslip protection works are completed.
Property level interventions are needed to manage future severe weather event risk, including in tandem with community level interventions.
Property specific measures are necessary e.g., improved drainage, raising houses is necessary.
If you have an open claim for damage from the weather events, the normal claim and post-claim policy review processes will be followed.
Your insurance covers the physical damage to your home from the event/s, up to your policy’s sum insured amount or any other policy limits and benefits that may apply.
The cost of planning or making property level interventions to prevent future flood or land damage is not covered by your insurance policy.
Properties in Category 2P have been identified as requiring intervention to manage future risk of damage from future severe weather events, this means your insurance may change at your policy’s next annual renewal to reflect the existing risk.
These changes could include:
If you have contents insurance for belongings kept at the property, these changes may also apply to that policy.
We will contact you approximately six to eight weeks ahead of your home policy renewing about the changes to your home policy more specifically.
Intervention work on Category 2P properties
The repairs of your property, and any property-level intervention works required to manage future risk, such as adding drainage or raising the level of foundations, need to be started within a reasonable timeframe.
We understand that you may need time to consider your options, and that what is reasonable will depend on your personal circumstances.
If the works are not completed, or started within a reasonable timeframe, we may no longer be able to offer insurance cover. Please contact us if you intend to delay repair or intervention works.
Interventions may be required/ possible but insufficient information to provide initial categorisation (these may subsequently move between Categories 2, to 1 or 3.
If you have an open claim for damage from the weather events, the normal claim and post-claim policy review processes will be followed.
We understand that properties provisionally placed in Category 2A, will move into a different category.
If your property is currently in Category 2A, it may be prudent to wait until the Category is changed to another one, due to the possibility it may move to Category 3.
Please contact us if you intend to delay repair or intervention works.
Future severe weather event risk cannot be sufficiently mitigated.
Some current land uses may continue to be acceptable, while for others there is an intolerable risk to human safety.
For example, the property may face an unacceptable risk of future flooding or could be subject to unstable land that poses an ongoing risk.
Currently, if you have an open claim for damage from the weather events, the normal claim and policy review processes will be followed.
Your insurance covers the physical damage to your home from the event/s, up to your policy’s sum insured amount or any other policy limits and benefits that may apply.
Your property being placed into Category 3 does not change the amount you are entitled to under your insurance policy, based on the damage to your property caused by the weather event/s.
If your property is confirmed as Category 3, we will no longer be able to provide insurance cover due to the high risk to people and property from future severe weather events, as identified by your local council.
After your property has been confirmed as Category 3, we will contact you directly to discuss how this will affect your insurance cover. Your property being placed into Category 3 will not result in immediate cancellation of your insurance cover, however, please read the information below to understand when your property’s cover will be cancelled.
If you’ve had a claim that’s been settled as a partial loss, and the home is still habitable.
We won’t cancel your cover immediately; we will continue to provide cover until the purchase of your property is completed by the council, or when their purchase offer expires.
If the home is uninhabitable
If the home on a Category 3 property is uninhabitable due to the damage caused by the severe weather events, your insurance will be cancelled following cash settlement of your claim.
Unfortunately, we will not offer new cover for any new or repaired buildings on the property due to the very high level of risk to your property from future severe weather events.
If you’ve had a claim that’s been settled as a total loss.
If you have a weather-related insurance claim that is settled as a total loss, or for the full sum insured amount on your policy, your insurance will be cancelled following cash settlement of your claim. This is part of our normal process for total loss home claims.
Unfortunately, we will not offer new cover for any new or repaired buildings on the property due to the high level of risk to your property from future severe weather events.
If you receive a property purchase offer from your council
If you receive a voluntary property purchase offer from your local council and your insurance hasn’t already been cancelled, your insurance will be cancelled when the purchase is completed, or when that offer expires if you choose not to accept it.
What we need from you
When the sale of your property to the council is complete, or if you choose not to accept the council’s offer, please let us know.
Unused Premium Refunds
If your insurance is cancelled part-way through the policy’s period, we will refund any unused premium, in accordance with your policy wording.