Government Changes Levy to Support Fire and Emergency

  • Hon Barbara Edmonds

The Government has passed new legislation amending the Fire and Emergency New Zealand (FENZ) levy regime, ensuring the best balance between a fair and cost effective funding model.

The Fire and Emergency New Zealand (Levy) Amendment Bill makes changes to the existing law to:

  • charge the levy on contracts of insurance for fire damage;
  • calculate the levy on the sum insured in an insurance contract for fire damage;
  • clarify how the levy applies to motor vehicles; and
  • amend the commencement date for the new levy framework to 1 July 2026.

“Fire and Emergency New Zealand provide services that play a critical role in keeping our whānau, communities and whenua safe,” Internal Affairs Minister Barbara Edmonds said.

“With FENZ funded by a 97 percent levy collection on insurance policies, it’s important that we ensure a fit-for-purpose funding model that supports their work.

“These changes will make the current framework more predictable and stable for both FENZ and levy payers. It will also ensure that the administration for insurance companies and brokers is much simpler.

“Under the new provisions, greater clarity will be given to which insurance arrangements will have the levy applied, simplifying levy calculations and avoiding some properties being charged twice.

“We have also amended the start date of the new levy system which will now come into force on 1 July 2026. This extension will give the insurance sector more time to implement the new system, along with time for associated regulations to be completed.

“By getting this framework right, we are delivering on a more effective and efficient levy regime that benefits insurance holders. These changes will reduce cost pressures on the insurance sector, keeping costs lower for New Zealanders.

“Passing this legislation is a significant milestone towards realising the benefits of the levy regime in the FENZ Act and will support FENZ to continue delivering services when we need them most,” Barbara Edmonds said.

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