Insurers urge authorities to "stop building in dumb places"

The Insurance Council of New Zealand (ICNZ) has reiterated its call for central and local governments to step up their planning decisions in response to climate change.

According to ICNZ, New Zealand’s householders and ratepayers are affected by the challenges of living with the changing climate and more frequent extreme weather events. While insurance can compensate the physical losses, ICNZ said that it is not enough to protect New Zealanders from the effects of climate change.

“Insurance is there for homeowners to help put things right, but its focus is on material loss and damage, and can’t really compensate for the stress and anguish of having to deal with a flooded house and potentially evacuation,” ICNZ said. “Nor does it cover what typically can’t be insured, such as loss of land, damage to the environment and the general impact on communities with a heightened sense of living in danger.”

ICNZ called out both governments and property developers for continuing to grant consents and build in areas that are at high risk of flooding.

These decisions end up costing rate and taxpayers, as they fund the Civil Defence response, cleanup and road repair costs whenever a flooding event happens.

“We really do need to stop building in dumb places,” ICNZ said. “Central government must move with urgency to give local councils the power they need to turn down consents in high hazard areas. Some argue local government has that power now. If so, they need to exercise it. If they don’t, they are just creating liabilities for the people that end up living there plus all local ratepayers who will then be on the hook, for decades, to put right the damage to all the infrastructure that goes with them.”