Council seeks insurance for below ground three waters assets

Kāpiti Coast District Council is seeking insurance for its below ground three waters assets as part of its work to establish an in-house business unit under the Government’s Local Water Done Well policy.

Previously Council procured insurance cover for its below ground three waters assets (drinking water, wastewater, and stormwater) as part of the Outer Wellington Shared Services Insurance Syndicate.

Mark de Haast, Council Group Manager Corporate Services, says the Outer Wellington Shared Services Insurance Syndicate is winding up due to the syndicate members becoming part of Tiaki Wai from 1 July 2026.

“This means Council now needs to secure insurance cover for its below ground three waters assets as a standalone entity.”

Council’s total insurance cost for 2025 was $3.2 million. The 2025 declared replacement value for Council’s three water assets was NZ $913.28 million.

Council has undertaken extensive loss modelling scenarios to understand its likely probable maximum loss (PML) ranges from natural catastrophe (earthquakes, landslips and flooding) and is looking to secure insurance cover up to $365 million for its below ground three waters assets from 1 July 2026 to either 30 April 2027 or 30 June 2027.

Central government currently provides insurance cover for up to 60 percent of losses to below ground assets caused from natural catastrophe, up to Council’s maximum PML.

Mr de Haast said Council must have insurance cover for up to 40 percent of these losses up to its maximum determined PML and Council is responsible for 100 percent of losses exceeding its maximum PML.  

“Council has invested a lot in water management, security, and infrastructure for the benefit of the Kāpiti Coast community and the environment in recent years and it is important that Council has appropriate insurance cover should something unexpected occur,” said Mr de Haast.

“On the advice of our insurance broker, AoN, Council’s Chief Executive and Group Manager Infrastructure and Asset Management are currently meeting with multiple offshore underwriters in London to talk through the condition of our assets, loss modelling scenarios, Council’s 30-year vision and strategy, and negotiate the best deal they can for our community.”