Progress of Insurance Law Reform
The Government's review of New Zealand's insurance contract law by MBIE continues. Submissions on the Insurance Contract Law: Options Paper close this Friday, 28 June 2019.
The Options Paper follows the issues paper published by MBIE in May 2018 and is part of the Government's plan to modernise and consolidate insurance law into one act. The key issues addressed in the Options Paper include: disclosure obligations for insureds;
• regulation of insurers' conduct;
• insurance exemptions from the Fair Trading Act 1986;
• consumers' ability to find and compare prices and policies; and
• reliance on exclusion clauses that do not cause the loss. It is anticipated that draft legislation will be introduced to Parliament in mid-2020. More information can be found on the MBIE website here.
We note submissions on MBIE's Options Paper on the Conduct of Financial Institutions closed earlier this month.
EQC Act – Changes come into effect July 2019
Part two of the Earthquake Commission Amendment Act 2019 comes into effect on 1 July 2019. From this date:
• The cap on EQC residential building cover is increasing to $150,000 (+GST); and
• EQC will no longer offer household contents cover.
From 1 July 2019, the changes will apply to policy holders from the anniversary date of their existing policy or when they take out a new policy.
The changes follow those made in February 2019 which increased the timeframe for lodging an EQC claim and broadened EQC's ability to share property-related information.
Canterbury Earthquakes Insurance Tribunal
The Canterbury Earthquakes Insurance Tribunal Act was passed on 31 May 2019 and the Canterbury Earthquakes Insurance Tribunal commenced on 10 June 2019. The establishment of the Tribunal fulfils a commitment in the Labour Party’s 2017 election manifesto to provide an alternative pathway for homeowners to resolve outstanding earthquake-related insurance claims. The set up and processes of the Tribunal have been influenced by the Weathertight Homes Tribunal.