Insurance, not just a box ticking exercise.

Insurance is no longer a simple tick-box when buying property. Climate change, natural hazards, and updated risk assessments are now directly influencing insurance availability and cost.

Obtaining a mortgage - You will need to confirm that suitable insurance can be obtained for the dwelling/property prior to confirming your finance condition, as lender-approved insurance is a requirement for finance. Additionally, your lender may request changes to your policy based on material property information, climate change forecasts, or other factors.

Climate change is making severe weather events more frequent and more intense. Risk classification may change over time and affect both your insurance costs and insurance availability. Climate change forecasting may also be relevant for the future resale of the property.

Check the natural hazards portal https://www.naturalhazardsportal.govt.nz/s/  to identify any settled Toka Tū Ake EQC claims against the property and if any natural hazards may affect the property.

We also suggest using the Tower Insurance website (as it seems they have updated their policies to align with the new National Adaptation Framework) as a litmus test to check your proposed purchase is not highlighted as priority location.

House, Car, Contents Insurance & More | Tower Insurance NZ

For more information please visit:  Buying a home :: Natural Hazards Commission Toka Tū Ake

So, what is the National Adaptation Framework?

The Government has introduced the National Adaptation Framework to help New Zealand prepare for the increasing impacts of climate change, such as more frequent flooding and severe weather events. As these risks grow, people and businesses need clearer information to understand how climate change may affect property, insurance, and future decisions. The Framework sets out a long-term approach to managing these risks by improving access to information, clarifying who is responsible for planning and action, and supporting better decision-making now and into the future.

The Framework is built around four pillars:

  • Risk and response information sharing

  • Roles and responsibilities

  • Investment in risk reduction

  • Cost-sharing pre- and post-event.

So, main takeaways to be aware of:

  • Before confirming your finance condition as satisfied, ensure that both you and your lender are comfortable with your proposed insurance policy.

  • Consider any potential climate change forecasting that may affect the future resale of the property, or insurance issues.

  • Include an insurance clause into your Sale and Purchase Agreement.

  •  Here is the Natural Hazards Commission’s Buying a Home checklist for you to use prior to entering an agreement. It will help you understand the risk profile of your potential new purchase. NHC-buying-a-home-checklist.pdf

Jo Shannon