Premium hikes for homeowners insurance from July will hit low income households hard warns the Insurance Council of New Zealand
Two major increases on those who insure their homes will be introduced this year, the first in July with a further hike in September.
A 40% increase in the fire service levy will take effect from 1st July 2017 while the EQC levy will rise by 33% on 1st November 2017; both charges are also subject to 15% GST.
The Insurance Council of New Zealand says this will mean an extra $450 before GST, forcing some lower income Kiwis to make a tough decision; stretch the household budget even further or go uninsured and take a huge risk.
“This election year there is an opportunity for political leadership to be shown,” Insurance Council Chief Executive Tim Grafton said. “Does New Zealand continue to go down the path of making it increasingly difficult for low income people to protect themselves or should we really be addressing our vulnerability?”
With New Zealand’s high vulnerability to natural disasters, there is not only risk for those that may decide they cannot afford higher premiums, but if fewer homes are insured there will be further premium rises for those that are.
“General taxation should fund the Fire Service which benefits everyone, insured and uninsured alike,” Grafton said. “The Crown balance sheet is now strong and can bear the $1.75 billion exposure that the EQC levy seeks to fund.”
The Insurance Council’s data reveals that just 25% of New Zealanders believe that the country is well prepared to minimize the economic and social costs of natural disasters.
A 40% increase in the fire service levy will take effect from 1st July 2017 while the EQC levy will rise by 33% on 1st November 2017; both charges are also subject to 15% GST.
The Insurance Council of New Zealand says this will mean an extra $450 before GST, forcing some lower income Kiwis to make a tough decision; stretch the household budget even further or go uninsured and take a huge risk.
“This election year there is an opportunity for political leadership to be shown,” Insurance Council Chief Executive Tim Grafton said. “Does New Zealand continue to go down the path of making it increasingly difficult for low income people to protect themselves or should we really be addressing our vulnerability?”
With New Zealand’s high vulnerability to natural disasters, there is not only risk for those that may decide they cannot afford higher premiums, but if fewer homes are insured there will be further premium rises for those that are.
“General taxation should fund the Fire Service which benefits everyone, insured and uninsured alike,” Grafton said. “The Crown balance sheet is now strong and can bear the $1.75 billion exposure that the EQC levy seeks to fund.”
The Insurance Council’s data reveals that just 25% of New Zealanders believe that the country is well prepared to minimize the economic and social costs of natural disasters.
