Landslide-related claims have become the single largest claims category for New Zealand’s natural hazards scheme, with the Natural Hazards Commission Toka Tū Ake (NHC) recording nearly 13,000 such claims in the last five years – compared with roughly 3,000 in the preceding five-year period, according to NHC data. The shift has renewed attention on how the scheme’s built-in cover limits interact with private insurance – and on whether residential policyholders, and the professionals advising them, have an accurate picture of where one ends and the other begins.
NHC attributed the surge to a sustained period of frequent storms, which have triggered slope failures across a country where sloped residential land is widespread. The commission said the volume represents more claims for landslide damage than for any other natural hazard category it currently handles. “Landslides can happen with little warning and cause significant damage to homes and property – and in some cases put lives at risk. As storms become more frequent and intense, landslides are understandably a growing concern for many communities,” NHC chief executive Tina Mitchell said.
New Zealand’s topography makes this an endemic risk rather than a regional one. Steep slopes are widespread across both islands, and the country’s varied geology – loose fill, fractured rock, and clay-heavy soils – increases the range of conditions under which slope failures can occur. According to NHC guidance, slopes exceeding 35 degrees, particularly those composed mainly of soil or that have been cut into or stripped of vegetation, carry heightened failure risk during heavy rain or seismic events.
The mechanics of NHC cover are relevant context for brokers and underwriters dealing with any residential property on elevated or sloped land. Under the scheme, a homeowner can claim up to $300,000 (plus GST) for damage to an insured dwelling caused by a covered natural hazard, including landslides, earthquakes, tsunamis, volcanic eruptions, and geothermal activity. Any repair cost above that figure falls to the private insurer up to the policy limit.
Land cover operates under a separate and more constrained set of rules. The scheme covers land repair only within approximately eight metres of the home, and the total amount recoverable is capped by statute. In practical terms, this means significant earthworks on a sloped property – stabilisation, drainage remediation, or slope regrading – will frequently exceed what NHC can pay, with no private insurer backstop for the land component itself.
That last point is material for client conversations. Private insurers in New Zealand do not offer land-specific coverage as a general product. Retaining walls are a partial exception: some private policies do cover retaining wall repair or replacement, though this varies by insurer and policy. Brokers whose clients own properties with retaining walls – whether timber, concrete, or block construction – should verify whether those walls are included in existing cover and under what conditions a claim would be accepted.
Driveways represent a further exposure that the scheme addresses only partially. Long access roads serving hillside properties may not be fully covered, leaving owners to fund reinstatement or find alternative access arrangements following a significant slip event. “It is also important to understand how your insurance works. That allows homeowners to make informed decisions – whether that’s strengthening their property or planning for any gaps in insurance cover,” Mitchell said.
One dimension of landslide risk that receives less attention in standard insurance reviews is the question of shared or boundary retaining walls. A wall that protects one property may sit on or near a neighbouring title, and if it fails, the consequences can extend across both properties. NHC notes that homeowners are not always certain which walls fall within their legal boundary, and that councils can assist in clarifying title questions. This matters for insurance purposes because liability and insurable interest both depend on ownership. A wall that turns out to belong to a neighbour may not be covered under the client’s policy, even if its failure damages the client’s land. Conversely, a client may hold responsibility for a wall whose failure they were unaware of. For high-value hillside properties in particular, a boundary wall review forms part of a thorough risk assessment.
NHC has outlined a range of physical indicators that can signal elevated landslide risk before an event occurs. These include surface cracking in soil, driveways, or paths; subsidence or bulging at the base of a slope; tilting trees or fences; and water seepage at the bottom of a slope. Inside a structure, signs can include doors or windows that no longer close squarely, diagonal cracking in exterior plaster or brickwork, and steps or paths that have begun to pull away from the building.
“Regular maintenance, good drainage, and getting expert advice early can make a real difference. If you have concerns about retaining walls or slope stability, a geotechnical engineer can help assess risks and recommend next steps,” Mitchell said. For brokers conducting site visits or reviewing property documentation, NHC’s Natural Hazards Portal records previous claims at a given address. A history of landslide claims on a title is one indicator of ongoing site susceptibility that may affect both insurability and future claim probability. “Understanding your property’s natural hazard risks before an event occurs can help reduce stress and financial pressure later,” Mitchell said.
The claims environment sits against a backdrop of deliberate change in how NHC manages the Natural Hazards Fund – the pool from which scheme payouts are drawn. Funded by a levy collected from every insured homeowner as part of their annual home insurance premium, the fund currently holds approximately $670 million. That balance reflects a period of conservative management following the Canterbury and Kaikōura earthquakes, which together put substantial strain on the fund’s reserves. NHC held the bulk of those reserves in cash and short-term deposits while working to rebuild its position.
In February, NHC published its first Statement of Investment Policy and Objectives (SIPO), signalling a shift toward longer-horizon investing. The fund is now targeting real returns of 2.5 percentage points above inflation on a rolling five-year basis, with planned diversification across asset classes subject to defined risk limits and staged implementation. Oversight of the new investment approach sits with an Executive Investment Committee and the NHC board. The SIPO also incorporates environmental, social, and governance criteria, consistent with NHC’s obligations as a Crown entity.
The combination of rising claim volumes, constrained land cover, and an evolving fund investment strategy points to several areas worth monitoring. Landslide frequency in residential portfolios is no longer a tail risk in many parts of New Zealand – it is a recurring line item. The structure of NHC cover means that clients on sloped properties are carrying more uninsured exposure than they may realise, particularly in relation to land, retaining walls not covered by private policies, and extended driveways.
The fund’s shift toward growth-oriented investing increases its long-term capacity to meet large claims, but also introduces variables that were not present when the fund sat in cash. For those involved in reinsurance or in advising on scheme-wide risk, the SIPO represents the first formal articulation of NHC’s investment risk appetite. The NHC partnership model places private insurers and brokers at the front line when events occur. Understanding the exact contours of scheme cover – and being able to explain the gaps to clients before a claim arises – remains one of the more concrete ways that insurance professionals can add value in a market where landslide exposure is rising.
