Update on Fire Service Levies and Reforms - April

Fire Service Levies and Reforms Update - Increases in levy rate 1 July 2017 - confirmed

Update April 2017

As expected, the government confirmed the fire service levy rate increases at the end of March. This increase will now be for an initial 18 month period until the new levy rate can be determined for the new regime which will come into effect from 1 January 2019.

The increases are:

  • Residential property insurance levy - an additional $30.00 per annum for residential buildings and $6.00 per annum for contents. Levies on the existing caps of $100,000 for dwellings and $20,000 for contents continue
  • Motor vehicles (less than 3.5 tonne) - an increase of $2.37 per vehicle per annum
  • Commercial property (non-residential) and vehicles over 3.5 tonne - rate increase from 7.60 cents per $100.00 insured to 10.60 cents per $100.00.  No cap on the increase.


This amounts to a 40% increase on the current levy rate with the cost of funding continuing to be borne by those who buy insurance. The cost of the increase is to fund the amalgamation of the rural and urban fire services into the new organization FENZ.

The increase will affect any new insurances or renewals of existing insurance after 1 July. It will also affect mid – term adjustments to existing insurance policies which are in place from 1 July so addition of some new property to be covered will attract levies at the new increased rate.

Fire and Emergency New Zealand Bill (FENZ)

This Bill repeals the two Acts governing fire services, the Fire Service Act 1975 and the Forest and Rural Fires Act 1977, to give effect to a single, unified fire services organisation for New Zealand. In December the Parliamentary Select Committee released their report on the FENZ Bill and recommended the Bill be passed with some amendments. A second reading of the Bill occurred on 15 February and it is expected the Bill will be passed shortly.

While the legislation will be passed, several important aspects relating to the levy has yet to be determined. This work is important as it will influence the amount of levy that has yet to be set when the new levy regime takes effect.

The Minister recently announced that the new levy regime which was initially scheduled to come into force in July 2018 has been delayed by 6 months to 1 January 2019. This is to allow further time for the insurance industry to adjust and get ready for the new levy regime and to allow FENZ to model the new levy rate accurately. Until then the transitional levy rate detailed above will continue to apply and run from 1 July 2017 – 31 December 2018.


Important Information The information on this website is only intended to provide a general summary on the topic.  For further information please speak to your broker.