Sea level rise, housing and insurance: Liability and compensation

This project looked at the question of sea level rise and insurance. It investigated the “tipping points” at which insurance companies might decide to refuse insurance to coastal property owners, and asked, what will happen next?

To what extent can or should homeowners rely on the EQC, or on local or central government, to compensate them if their homes become uninsurable, or uninhabitable, due to sea level rise, or because of associated climate risks like storm surges or coastal erosion?

One of the key trends in international climate litigation is in trying to establish who is liable for taking (or not taking) adaptation measures. For example, in a recent Australian case, residents sought damages from their local council, both to pay for shoreline protection and to compensate them for the loss of property value from rising seas. They argued that the loss was in part the fault of the council and its earlier inaction.

Our research has analysed where sea-level rise risks currently fall across different parties. We have identified and evaluated the policy options available to local, regional and national government when the tipping point of uninsurability is reached.

The project has also investigated the Crown’s Treaty of Waitangi obligations in relation to sea level rise. Māori communities are likely to be severely affected by sea level rise, with many rural Maori communities situated along the coast. Where communities have limited economic power and access to finance, and little or no insurance cover, effective policy options for uninsurable Māori housing are critical.

This project in the media:

• Time for govt to step up on sea level rise – new research, Newsroom
• How to survive a shipwreck: A sea level rise story, Spinoff Ātea
• The legal threat and the big opportunity in Māori engagement on climate change response, Stuff
• Insuring coastal properties, Radio New Zealand
• How climate change could send your insurance costs soaring, Stuff
• Our slow-moving disaster as sea level rises, NZ Herald
• Who should bear the cost of a changing climate, Insurance Business Mag
• How can NZ insure homes for climate change? NZ Herald
• Sea level-prone homes set for insurance cutoff, Radio New Zealand
• Heads in the sand, houses in the water, Newsroom
• Climate change and insurance – Expert Reaction, Science Media Centre