For most of the past century, New Zealand insurance law asked something slightly unreasonable of ordinary people. The duty of disclosure required an applicant to volunteer anything a prudent insurer might consider material, whether or not they had been asked about it, and whether or not they had any way of knowing it mattered.
It is a duty that assumes the applicant thinks like an underwriter. Very few do, which is broadly why they are buying insurance rather than selling it.
What the Act does
The Contracts of Insurance Act 2024 The Contracts of Insurance Act 2024 replaces that standard for consumer contracts. In its place sits a narrower obligation: the consumer must take reasonable care not to make a misrepresentation to the insurer.
The standard is objective, judged against a reasonable policyholder in the circumstances, and it applies before a contract is entered into or varied, which includes renewal. The responsibility for asking the right questions moves to the party that writes them.
The Act also requires policies in plain language, and requires insurers to tell policyholders what their disclosure duties are and what happens if they are breached.
When
Implementation is phased. The substantive changes take effect on 15 November 2027, three years after the Act passed.
That is not soon, and it does not help anyone applying for cover today. Until commencement, the existing duty applies in full.
What has not changed
It would be a serious misreading to treat this as a relaxation.
Answering carelessly still costs you. The standard is reasonable care, not no care, and an application completed at speed, with approximations where there should be dates, is as capable of costing a claim under the new regime as the old. Deliberate misrepresentation is treated severely, and rightly.
What changes is the treatment of the honest applicant who did not know what they did not know. That person has been poorly served by the current law and will be better served by the new one.
The habit worth forming now
Most declined claims I see do not involve dishonesty. They involve someone who genuinely forgot a consultation in 2019, or did not think a resolved condition counted, or assumed the insurer already knew because it had been mentioned once on the phone.
Three practices reduce that risk to almost nothing under either regime.
- Get your medical notes before you apply, not after a claim is questioned. You are entitled to them and they are usually more detailed than your memory.
- Disclose it if you are unsure. There is no penalty for disclosing something immaterial. There is a considerable one for omitting something material.
- Keep what you sent. A dated copy of the completed application, filed somewhere you will find it in fifteen years.
None of that is onerous. It is the difference between a claim that is paid and a claim that becomes an argument at the worst possible time.
Arrange a time to talk. We meet in person, in Hamilton or wherever suits you.
Contracts of Insurance Act 2024, New Zealand Legislation; commencement and duty analysis per MinterEllison and Browne Jacobson commentary, 2025.