The Natural Hazards Commission Toka Tū Ake (NHC) has appointed three external investment managers. They will start moving the Natural Hazard Fund out of the cash and short-term deposits that have held it since the Canterbury and Kaikōura earthquakes.
Mercer NZ will manage listed equities, Fisher Funds Management will handle cash, and Amova Asset Management New Zealand will look after other fixed interest.
NHC said the managers were chosen through a competitive tender that drew bids from New Zealand and overseas. It did not say how the fund will be split between them, what fees it will pay, or when the money will move.
The fund now holds about $887 million, according to NHC. That is up from roughly $670 million when the commission published its first Statement of Investment Policy and Objectives in February.
NHC chief financial officer Chris Chainey said the appointments put into practice the investment direction announced earlier in the year. He said the managers had the expertise to improve NHC’s financial resilience while keeping a prudent approach to risk.
“By broadening how the Fund is invested, we’re strengthening its ability to support homeowners over the long term,” said Chainey.
The fund is built from the levy every insured homeowner pays as part of their home insurance premium. NHC uses it to settle claims for natural hazard damage. After the two earthquake sequences drained it, the commission rebuilt the balance cautiously, holding mostly cash and bank deposits.
The updated SIPO, effective from July 1, sets the main long-term target: returns that beat inflation by 2.5% a year over rolling five-year periods. NHC said diversification should help the fund grow over time and reduce the scheme’s reliance on the Crown guarantee.
The appointments have arrived later than first planned. NHC’s procurement notice in March said it aimed to have managers in place and working from July 1.
The fund remains modest next to the scheme’s exposure. NHC placed a record $12.3 billion of reinsurance for the 2026 policy year, $2.1 billion more than the year before. That cover is also paid for from levy income. In a major event, reinsurance and the Crown guarantee would still carry most of the cost.
Investment returns are therefore unlikely to change the scheme’s finances quickly. Over time, though, a fund growing ahead of inflation would leave less of the burden on the Crown and on future levy increases.
The levy sits inside every home premium brokers place, and its level remains a live political question. The government kept the levy unchanged in November 2025, citing affordability. The Insurance Council of New Zealand has said taxes and levies make up around 40% of a home premium. During the election campaign, parties set out differing views on who should carry disaster risk, the insurers, councils or the Crown.
A larger, better-performing fund gives the incoming government more room to hold the levy steady. A weak run of returns, or a major event before the new portfolio is established, would push the question back onto premiums. For brokers handling renewal conversations, the fund’s progress against its inflation-plus target is the figure to watch, and NHC has not yet said how often it will report it.
