The Insurance Brokers Association of New Zealand urged home buyers to think with their heads rather than their hearts when committing to a real estate purchase.

New actuarial data supplied to Treasury shows house insurance premiums have jumped by more than 30% in some areas of New Zealand while insurance companies are blocking some regions from being able to get online quotes, as concerns about climate change-driven natural hazards increase.

IBANZ reports its broker members have never been busier as clients are finding it more difficult to self-serve when it comes to securing insurance coverage for their most valuable asset.

IBANZ CEO Mel Gorham said: “Homeowners may now find it more difficult to arrange house cover in order to settle on a newly purchased property, even if it wasn’t affected by last year’s weather events, as insurers are now more sensitive to possible natural hazard risks.

“Insurance brokers can often help homeowners in these circumstances as they have good local knowledge, expert understanding of the insurance market, and access to policy options that individual homeowners can’t purchase directly.”

However, Gorham said home buyers can help by thinking about their insurance needs beforehand.

According to Gorham, buyers need to consider whether their property has increased natural hazard risk potential and seek competitive insurance quotes before committing to a purchase.

“Remember, if you need a mortgage then your lender will want to see evidence that there is insurance cover in place before advancing the funds.

“It’s easy for first home buyers in particular to be wowed by views, school zones or that dream kitchen, but IBANZ urges buyers to stay grounded in reality and make sure the property really is a sound investment before signing up,” she added.

June 2024