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Liability insurance

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What is statutory liability insurance?

Statutory liability insurance protects you, your business and your employees, including directors, trustees and managers, against certain unintentional breaches of New Zealand law resulting in prosecution.

Statutory liability policy provides access to specialist legal assistance and expert advice if you or your business is being prosecuted for breaching an Act.  

Any company, business or organisation operating in New Zealand needs statutory liability cover.

What statutory liability insurance covers

Statutory liability insurance covers the organisation, any owner, director, officer, trustee manager or secretary, for reparations and the cost to defend prosecutions.

It can cover prosecutions under many laws, including:

  • Health and Safety at Work Act 2015
  • Food Act 2014
  • Resource Management Act 1991
  • Building Act 2004
  • Consumer Guarantees Act 1993
  • Fair Trading Act 1986
  • Privacy Act 1993

It can also cover:

  • Investigations by the Commerce Commission
  • Investigations of workplace injuries

The policy does not cover:

  • Health & Safety at Work Act fines and penalties, though reparations are covered (eg the amounts paid to the victim or their family for emotional harm, property damage or consequential losses.)
  • employee contract claims
  • police prosecutions or IRD proceedings
  • Criminal allegations or liability arising from deliberate, willful or reckless acts or omissions.

Our brokers can advise you on the best liability solutions to protect you against unintentional breaches of the New Zealand law. They will work with you to create a tailored, cost-effective insurance liability package that safeguards your business. In the event of a claim arising, we'll work with you to get a fair resolution.

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Health and Safety at Work Act

While cleaning out a boiler an employee’s leg was caught in a conveyor and had to be amputated below the knee. WorkSafe investigated the accident and prosecuted the company under the Health & Safety at Work Act.

There were mitigating factors and through the company’s Statutory Liability policy they secured access to specialist lawyers who built a strong defence case.

The court awarded a small fine of $5,000 (not insurable) and ordered reparations of $50,000. The company’s statutory liability policy was able to pay both legal defence costs and the reparations.

Resource Management Act

A local bus operator had a diesel fuel facility in its yard. The tank was owned by the fuel supplier but the bus operator was responsible for its upkeep. The fenced and gated yard was broken into at night and an unsecured valve on the tank was maliciously opened and fuel was able to run into the bund area surrounding the tank. Unfortunately, the drain hole in the bund had been left open the previous day and 8,000 litres of fuel ran into a nearby stream. 

A massive clean-up operation was undertaken. However, the local council brought an action against the bus operator and its supplier under the Resource Management Act.

The bus operator was convicted and fined with substantial defence costs however these were coverable by their policy .