The Role of the Natural Hazards Commission 

The Natural Hazards Commission’s (NHC) role is to reduce the impact of natural hazards on people and properties in New Zealand.

We do this by:

• managing a central fund. The levies paid into the fund are invested and used to purchase reinsurance, meet the costs of administering the scheme and invest in research and education - to prevent or minimise the impact of natural hazard events  
• administering insurance through the scheme to help rebuild or repair homes and limited areas of land, in partnership with private insurers
• building resilience at an individual, community and national level through investing in scientific research, providing education and awareness, and influencing policy and systemic decisions that reduce New Zealand’s vulnerability and exposure to natural hazards.

The Natural Hazards Commission is part of the New Zealand government. We operate independently and are governed by a Board of Commissioners who are accountable to the responsible Minister.  

The Natural Hazards Insurance Scheme

Overview

New Zealand’s Natural Hazards Insurance Scheme provides the first layer of residential insurance for homeowners, covering damage to homes and some surrounding land caused by major natural disasters.

What’s covered:

• Up to NZ$300,000 plus GST (minus any excess) for actual losses due to damage to a home after a covered event.
• Limited cover for the land area immediately around the home and certain landscape features.

Natural hazards included:

• Earthquake
• Landslide
• Volcanic activity
• Hydrothermal activity
• Tsunami
• Storm and flood (land cover only)
• Fire caused by any of these hazards

Homeowners also purchase private insurance for additional cover above the scheme’s limit and for other risks (such as wind damage).

How it works

• Every homeowner with a home insurance policy is automatically included in the scheme.
• The scheme reduces the burden on private insurers by taking on the most severe catastrophic risks, making insurance more accessible and affordable for New Zealanders (95% insurance coverage).
• Claims are managed by private insurers on behalf of the scheme, giving homeowners a single point of contact for all insurance claims.

Funding

The scheme is funded by homeowner levies, reinsurance, and a government guarantee.

• Levy: Set by the New Zealand Government.
• As of November 2025, the cost is 16 cents per NZ$100 of insured property value per year, capped at NZ$480 plus GST (15%).
• The levy is included in insurance premiums paid annually to private insurers.

Natural hazard fund

Levies are paid into a central fund called the Natural Hazard Fund, which helps pay claims after major disasters.

• By 2010, the fund had grown to over NZ$6 billion, but was fully used to settle claims from earthquakes in 2010-11 and 2016.
• The fund is now being rebuilt through levies and investments and currently stands at around NZ$500 million.

The Government’s Funding and Risk Management Statement (FRMS) sets out how costs and risks are shared between the Government and levy payers, including projections for the fund and policy considerations for levy settings.

Legislative framework

The scheme operates under the Natural Hazards Insurance Act 2023, which came into effect on 1 July 2024.

• The Act modernised and replaced the Earthquake Commission Act 1993.
• It changed the organisation’s name from the Earthquake Commission to the Natural Hazards Commission, to ensure homeowners understand the range of hazards covered.
• The Act incorporates lessons from past events and the 2020 Public Inquiry into the Earthquake Commission.
• Key features include capped residential cover for defined hazards and improved homeowner experience, such as dispute resolution pathways.

Origins

New Zealand faces significant natural hazard risks, similar to Japan and Taiwan.

• After major earthquakes in the 1930s, insurance became unaffordable for many.
• In response, the Government introduced a scheme in the 1940s to spread risk across all insured homes.
• The first version launched in 1945, funded by a levy on fire insurance policies.
• In 1993, the Earthquake Commission Act created EQC, focusing on residential cover and natural hazard research.

• In 2023, the Natural Hazards Insurance Act was passed, marking the latest evolution of the scheme.

• NHC Programme Summary