Every question, every answer, every source

In New Zealand, when a property insurance policy has special terms, exclusions, or a high earthquake excess, the best way to compare cover is to look beyond the annual premium. Focus on what each insurer will actually pay after an earthquake or other major loss, what you would need to pay yourself, and whether any restrictions could leave you underinsured.

A cheaper policy can be poor value if it has a much higher excess, a lower payout limit, or special conditions that make a claim harder to settle.

1. Compare the terms that matter most

What to compare	What to look for
Earthquake excess	The dollar amount or percentage you must pay for each claim, and whether it is calculated on the sum insured or the damage amount.
Special terms	Restrictions relating to the property's earthquake risk, construction, foundations, retaining walls, or previous damage.
Exclusions	Damage or structures that are not covered, including any specific exclusions added for your property.
Sum insured	Whether the insured amount is sufficient to rebuild the home, including demolition, debris removal, professional fees and compliance with current building requirements, where covered.
Claims settlement	Whether the insurer pays repair costs, rebuilds, or applies particular limits or conditions.
Premium	The annual cost, considered alongside the excess, exclusions and quality of cover.

Pay particular attention to the policy schedule and any endorsements or special conditions. The standard policy wording alone may not tell you the full story for your property.

2. Calculate the real cost of an earthquake excess

A percentage excess can be much more expensive than it first appears.

For example, if a property has a sum insured of NZ$1 million:

Illustrative earthquake excesses

2% excess

Of NZ$1 million

$20,000

5% excess

Of NZ$1 million

$50,000

10% excess

Of NZ$1 million

$100,000

These are examples only, not quoted terms. Check whether the actual policy applies the percentage to the sum insured, the claim amount, or another defined amount.

Ask the insurer whether the excess applies per event, per building, or separately to different types of damage. Also check whether a natural-hazard claim involves separate building and land excesses under the applicable New Zealand scheme. InsuranceAbout natural hazards cover :: Natural Hazards Commission Toka Tū Ake

3. Treat special terms as a separate risk

Don't simply rank policies from cheapest to most expensive. For each special condition, establish:

• What exactly is restricted? Get the full wording rather than relying on a verbal description.
• What is the consequence? Does the term increase your excess, exclude a particular type of damage, impose a sub-limit, or require repairs or engineering work?
• Can the restriction be removed? Ask whether an engineering report, a builder's assessment, completed remedial work or further documentation could improve the terms.
• What remains covered after an earthquake? Clarify whether the restriction affects only a particular component, such as foundations or retaining walls, or could affect a wider claim.

A policy with a high excess but broad cover may be preferable to one with a lower excess and a significant earthquake exclusion. The answer depends on the actual wording and the financial risk you can afford to carry.

4. Understand the New Zealand natural-hazard cover

For residential property, distinguish the cover provided by the Natural Hazards Commission Toka Tū Ake (NHCover) from the additional cover provided by your private insurer.

NHCover generally applies to eligible residential property with the required qualifying private insurance, subject to statutory limits and conditions. It does not mean every part of an earthquake loss will automatically be paid. Land, buildings, retaining walls and other features can be treated differently, so check the applicable limits and your private policy's response. About natural hazards cover :: Natural Hazards Commission Toka Tū AkeHouse & Contents Insurance: Sum Insured Explained

Useful official guidance:

• Natural Hazards Commission — NHCover
• Insurance Council of New Zealand — Consumer guides

5. Use a side-by-side comparison before choosing

Ask each insurer or broker to complete the same comparison for the property.

Comparison point	Insurer A	Insurer B
Annual premium	$___	$___
Earthquake excess and calculation basis	___	___
Special terms and exclusions	___	___
Foundation and retaining-wall cover	___	___
Rebuild limit and additional costs	___	___
Conditions that could improve cover	___	___
Maximum likely out-of-pocket exposure	$___	$___

My recommendation: Give the greatest weight to the breadth of earthquake cover, the dollar amount of the excess, and any exclusions that could affect a major claim. Consider the premium only after you understand those three factors.

If the terms are unclear, ask the insurer or broker to confirm the interpretation in writing before committing. The Insurance Council also recommends checking the latest policy schedule and wording, rather than relying on previous renewal terms. Consumer GuidesDuty of Disclosure: What to Tell Your Insurer

One question that would help me tailor this advice: Are you comparing insurance quotes for a property you already own, or assessing a property before buying it? The best approach differs slightly, particularly if the special terms relate to earthquake-prone land, foundations or previous damage.