Please find information about the charges shown on the MDBI invoice.
The company premium is what the insurers charge us to reinstate/ replace our assets and comprises two main components:
The insurer refers to cover other than natural disaster insurance as perils. This includes outcomes such as broken windows through to the total loss of assets due to fire (for example). The perils cost is charged at a base national rate with some adjustment for assets that are occupied full time. The rate is influenced by our actual claims experience.
For all commercial covers and for residential covers in excess of the EQC cap, we are charged rates determined by cresta zones. Cresta zones are similar to postal zones and reflect the geographic risk of an earthquake. The costs are therefore considerably higher in NZ geographic areas considered earthquake prone. Overall, the whole of New Zealand has a higher earthquake risk than many countries and this is reflected in comparably higher natural disaster insurance costs.
All Other Costs
All other costs comprise of two main components;
Commercial Fire Service Levy
In addition to the residential fire service levy, a commercial FSL is payable on all contracts of insurance, but unlike the residential FSL the commercial FSL is uncapped. The levy rate is also 10.6 cents per $100 of cover. With the help of fire risk assessments, each year we consider our maximum probable loss in the event of a fire and insure for this amount and pay a single levy for all members. This levy is then apportioned based on per member fire sums insured.
These are the annual costs of operating the Anglican Insurance Trust (managed by AIB) and include items such as accountancy and audit fees (Charities compliance), legal fees, management fees, system costs etc. These are offset by interest, dividends and other income with the net annual costs allocated to each member based on each members total company premium and levies due.
If you pay other than annually in advance, interest is charged. This interest cost does not attract GST. A bank payment authority must be in place.
AIB assisted in the establishment of the Concordia Underwriting Agency by agreeing to become a foundation customer, in return AIB participate in Agency profits. It is envisaged that returns from Concordia will be used to offset Trust operating costs and the costs of any initiatives made on behalf of members.
For those members who have taken up Core Logic’s valuation offer, AIB have offered to collect the annual fee for each members Cordell estimators use and the Core Logic fee is included in All Other Costs. Please note that AIB do not have any responsibility for members use of Core Logic’s estimators.
If you encounter unforeseen circumstances which impact your ability to pay, please get in touch with us quickly so we can assist.
If accounts remain unpaid and no agreed payment plan is in place, a penalty of 1.0% of the unpaid balance will be assessed in the first month, if no agreed payment plan is in place after two months; insurance may be cancelled. Any and all costs incurred in the recovery of the unpaid balance may be added to the balance of your account, including but not limited to debt recovery charges and legal fees.
What is covered?
From 1 July 2019 or the next renewal (whichever is the later), the EQC provides the first $150,000 (the ‘cap’) of natural disaster insurance cover on residential buildings. This means that the EQC handle all natural disaster insurance claims for claims valued at less than the cap.
The cost is 20 cents per $100 dollars of cover. The EQC rate is a nationwide rate which means that most members will pay $300 ($150,000/100 x 20 cents) per insured residence.
Fire Service Levy
What is covered?
The residential Fire Service Levy (FSL) is payable on all contracts of insurance against the risk of fire where assets in New Zealand is covered. The levy funds the activities of the fire service (FENZ) only.
The current nationwide levy rate is 10.6 cents per $100 of cover and is capped at $106 per residential building and $21.20 per residential contents.