By: Antony Holden, Misha Henaghan, Mathew Francis, Richie Flinn, Katie Shanks, Sam Hider

Today, the Ministry of Business, Innovation, and Employment in New Zealand (MBIE) hosted a webinar on the work it is doing across a variety of building reforms. These reforms affect liability exposure, insurance settings, compliance costs and the building consent process.

The key updates include:

  • Proportionate liability legislation is advanced but awaiting introduction;
  • Earthquake-prone building reform is expected to significantly reduce the number of buildings in scope;
  • Self-certification reforms are moving ahead with safeguards;
  • BCA reforms continue; and
  • Solar consenting changes are coming.

Proportionate liability

MBIE describes this as “the biggest piece of reform we are currently working on”. MBIE has been working with drafters to turn government policy into a bill.  Most of this legislation is drafted and ready to go. However, the government will need to find time to introduce the bill into Parliament and the select committee process if it hopes to meet its 2026 commitment.

MBIE recommends checking for announcements (on its and other government websites) on the timing of the legislation. However, it noted the likelihood that the legislation will come into force a year after it receives royal assent to provide sufficient lead time for the market (including insurers and warranty providers) to come to terms with the changes. Once the bill is introduced, MBIE has said regulations will come into effect which allow potential warranty providers to register with MBIE.

MBIE cannot release much technical detail at this stage, but crucially it has now confirmed:

  • The minister will have the power to suspend the warranty requirement if there are insufficient home warranties on the market.
  • MBIE is focussed on standard residential housing for now, but it intends to consider whether warranties are required in the high-rise apartment space as well.
  • Non-restricted building work will not require a home warranty even if it costs more than NZ$100,000.
  • Warranty providers are unlikely to provide cover for builders who are known to create phoenix companies.

Earthquake-prone buildings (EPB)

As has been widely reported, the government is substantially changing the EPB regime to significantly reduce the number of buildings considered earthquake-prone and to reduce the costs to building owners of retrofitting affected buildings. The goal of the changes is to remove many buildings not originally intended to be caught by the EPB regime.

Compliance will become significantly cheaper too with a tiered approach (depending on risk level) consisting of:

  • Securing facades;
  • A targeted retrofit; or
  • A full retrofit.

MBIE explained the decision to remove Auckland from the system — modelling and cost-benefit analysis showed there was very little benefit to including Auckland buildings in the regime.

MBIE is also looking to address unaffordability around heritage buildings. It is working with the Ministry for the Environment on changes to the planning system and looking for more relief, including not requiring a resource consent for strengthening/retrofitting work.

MBIE says many buildings, including 1-2 storey timber buildings, were included in the EPB regime and this was never the intent. There is more to do before passage of bill at the end of the calendar year, including drafting and consultation on the detailed EPB methodology. However, the overall outcome will be far fewer buildings in the system — likely a 55% reduction. This is expected to save NZ$8B for building owners across New Zealand.

Self-certification

On 2 June 2026, the Act to establish voluntary self-certification for plumbers and drainlayers received royal assent. The system is obviously well-developed with comprehensive resources available on the MBIE website: Self-certification schemes for builders, plumbers and drainlayers | Building Performance.

The self-certification regime for residential builders is also being finalised. However, MBIE promises this will have “strong and robust” safeguards, including a requirement for builders to pass a means test including consideration of whether they:

  • Can cover a full range of potential liabilities (with adequate insurance, warranties and/or capital);
  • Have a history of starting phoenix companies; and
  • Have appropriate processes and systems (including dispute resolution processes and management of staff on site).

The stated intention of the self-certification regime is to free up BCAs for “higher risk work.”

Strengthening Occupational Licencing Regimes Bill

To provide further safeguards for homeowners, the government is tightening the reins on LBPs. The Building and Construction Sector (Strengthening Occupational Licensing Regimes) Amendment Bill will increase maximum fines for LBPs to NZ$20,000 and LBPs will be subject to a longer maximum suspension of 24 months.

Voluntary BCA consolidation

MBIE is progressing its work to encourage BCAs to consolidate, partly by removing the requirement for territorial authorities to be BCAs.

Rooftop solar consenting changes

The government is looking to fast track building solar arrays and buildings with sustainable attributes. This includes a significantly reduced consenting deadline of 10 working days if certain requirements are met. Those requirements for rooftop solar will be included in the New Zealand Gazette soon, with further announcements on energy efficiency and water efficiency to follow.

Conclusion: a very busy future for MBIE and the building sector

While proportionate liability may still be some time away, there is plenty of change to grapple with in the construction sector. There are changes to the risk settings on several fronts ­— from earthquake-prone buildings to self-certification. Keep an eye out for more updates and for opportunities to submit during the various consultation processes.

Please reach out to our construction experts if you would like to discuss how these changes may affect the insurance industry or the New Zealand risk landscape.