Five Tips to Insuring in a Flood Zone

Floods are the biggest cause of natural damage to property in New Zealand. Much of our country has a high flood risk, meaning many properties lie in or near flood zones. This makes insurers cautious when it comes to flood-prone houses.

The 2017 Edgecumbe flood was one of New Zealand’s worst in recent history.

If you’re looking at buying a flood zone house, we recommend you follow these five steps.

1. Check the LIM Report

The easiest way to find out if your house is in a flood zone is to read over the LIM [Land Information Memorandum] report for the house.

If the house has been identified by the council as being at risk to any natural hazards (including floods) this will be included in the LIM report. The Certificate of Title will inform you if a Section 36, 73 or 74 of the Building Act has been issued.

In simple terms, this means when getting building consent on the house, a natural hazard risk is declared.

The LIM report should provide you a good overview of the extent of the flood risk to the house.

2. Check online council hazard maps

If you don’t have access to a LIM report or do not want to pay for one, you may be able to find flood risk information online.

Most local councils now release public online Geo Mapping for natural hazard risks on houses. Unfortunately, each regional council has different maps so you will need to find the relevant one for your home.

Try searching the internet for your local council’s name and adding ‘hazard maps’ to your search term.

If you can find your council’s online mapping tool you will then need to filter through the different natural hazard types. Then enter your address and add the flood zone layers and you will be able to see how and if your property lies over a flood zone. There should also be information available about the extent of the flood risk.

3. Be prepared to pay more

If your house is in a flood zone it is likely you will be able to get cover. But it may not be with your first choice as insurers are more likely to decline cover in flood-prone areas.

Depending on the extent of the flood risk at your house, you may either pay more for a premium or have a significantly higher flood damage excess.

If we accept cover on your flood zone property, we may apply an imposed flood endorsement with a higher excess. An example of this endorsement can be seen below.

Example Flood Endorsement

We will not pay for any costs of additional materials, work or expense required solely to comply with Government or local authority bylaws and regulations, if those costs are required solely to meet the requirement of Government or local authorities to reduce the exposure to a natural hazard at the home.

An excess of $2,500 applies to any claim for water entering the Home as a result of flood, or inundation by seawater, replacing the excess shown in the schedule.

For the purpose of this endorsement, flood means the covering of normally dry land:
i. by water that has escaped or been released from the normal confines of:
a. any lake, or any river, creek or other natural watercourse, whether or not altered or modified, or
b. any reservoir, canal or dam,
ii. by rain water pooling or failing to drain away

4. Check how extensive the flood zone is

Flood zones cover much of New Zealand. Some are higher risk while others might only be minor, meaning it’s important to get an idea of the extent of the flood risk.

Risk is usually defined by the yearly frequency. The most common are 100-year flood zones. This means research and history predicts there is a 1-in-100 chance of a flood event each year.

If there is a 1-in-50 year, this means a flood is twice as likely to occur in any given year. A lower risk flood zone might only be a 1-in-200 year.

You can generally find this information either on the LIM report or mentioned on the council data.

5. Check the property isn’t at risk to other natural hazards

If you have a LIM report or found information online, it also pays to check the house is not at risk of other natural hazards.

Common natural hazard risks to houses in New Zealand include landslips and subsidence, or coastal erosion if the house is near the ocean.

Places like Whangarei are particularly prone to both landslips and flooding. It’s also common for flood zones to be around coastal erosion areas. Checking this will give you a much better understanding of the overall risk to the home.

How do I get insurance on my flood zone home?

You can apply for insurance on your flood zone property by getting an instant quote via the button below. Please note the flood risk will need to be disclosed to us when you send an application. If you fail to disclose this to us, you risk having a future claim declined for non-disclosure.

Get Instant House Quote

Submitting a referral

If you would like to proceed with your quote, select your preferred payment option at the bottom of the quote. You will then need to disclose the flood risk and any other relevant information during the declaration questions in the application.

This will submit a referral to us which we can then review. You will not have to pay for the policy at this stage.

We may confirm to provide insurance cover on your home, or we will ask for further information if required.

Flood & Landslip Questionnaire

If you still have questions, you can complete our Flood and Landslip Questionnaire and email it to [email protected] along with any supporting documentation. We will then review your application and confirm if we can provide insurance on your home.

If you have suffered a flood and are wanting advice on your claim, please refer to our helpful claim guide.