The Role of EQC Claims When You Sell a House in NZ
An EQC claim does not stop you selling, but it does travel with the property in a way many sellers do not expect. Rights to any unpaid settlement can pass to the buyer if the sale paperwork says so. Money already paid to you stays with you unless the contract says otherwise. If you say nothing, the claim stays with you, not the buyer. This guide explains how that works, what buyers and their lawyers will ask for, and how to keep a sale moving when the file is messy.
A quick note on names. EQC is now the Natural Hazards Commission Toka Tū Ake (NHC), and its cover is called EQCover or NHCover depending on the date of the event. Most Kiwis, and most buyers’ lawyers, still say “EQC claim”, so we do too.
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TL;DR
- An EQC claim, or part of one, can be transferred to a buyer through a clause in the sale and purchase agreement or a Deed of Assignment (DOA).
- Without an assignment, the rights and benefits of the claim stay with the previous owner.
- Transfer does not guarantee a payment. If the claim has already been settled, the buyer’s remaining entitlement may be zero.
- Buyers will ask for claim numbers, scopes of work, payment details and proof that repairs were finished. Answer honestly and have the paperwork ready.
- If the file is incomplete or the house is damaged, a direct sale to a cash buyer can avoid much of the back and forth.
Table of Contents
- What an EQC claim actually is
- Why the claim matters to a sale
- Can an EQC claim transfer to the buyer?
- Open, settled and reopened claims
- What you need to disclose and have ready
- What buyers should check
- How to arrange the assignment
- A short worked example
- Our view on EQC claims and selling
- When a direct sale makes sense
- Get a no-obligation offer
- FAQ
- Sources
What an EQC claim actually is
An EQCover or NHCover claim relates to natural-disaster damage to covered buildings or land. According to the Natural Hazards Commission, when a home with a previous claim is sold, the claim’s rights and benefits can be transferred, and the claim history and repair status matter to everyone involved.
The hazards covered for buildings are earthquakes, landslips, volcanic eruptions, tsunamis, geothermal activity and fires caused by those events. There is also limited cover for land damage from storms and floods, as Settled.govt.nz sets out. It is separate from your private house insurance, which deals with other types of damage. If you are unsure which scheme covers what, our guide to types of property damage and when EQC or insurers pay is a good starting point.
Why the claim matters to a sale
Three things make a claim relevant the moment you list or negotiate:
- It affects value. A buyer wants to know whether damage was fixed properly, or whether they are inheriting a repair bill.
- It affects insurance. Incomplete repairs may prevent a buyer from getting private house insurance or NHCover for future events, according to the NHC guidance.
- It affects who gets paid. Without clear paperwork, nobody is sure whether the buyer, the seller, or no one is owed anything further.
None of this is unusual, and none of it is a reason to panic. It is a paperwork question, and paperwork can be sorted out.
Can an EQC claim transfer to the buyer?
Yes. NHC says a claim, or part of a claim, can be transferred by a DOA or by a clause in the sale contract. The buyer then takes on the previous owner’s rights and any remaining settlement. Consumer Protection confirms that the new owner gets the same entitlements as the previous holder, including any remaining entitlement up to the cap for that natural-disaster event.
Three points sellers often miss:
- Money already paid stays with you. Cash paid to you normally remains yours unless the sale contract transfers it.
- No assignment means no transfer. If the property is sold without assigning the claim, the rights stay with the previous owner.
- Chains must be traced. Where a house has been sold several times, the assignment must run from the original claimant through each owner to the current one. A gap in that chain is a problem for the buyer’s lawyer to solve, so check yours early.
Private-insurance claims are different. Consumer Protection notes they may give different entitlements, or no equivalent transfer at all, so a buyer needs to look at each insurer separately.
Open, settled and reopened claims
The status of the claim decides what a transfer is worth.
| Claim status | What it means for the sale |
|---|---|
| Open (not yet settled) | Assignment preserves any remaining entitlement, but does not guarantee acceptance or payment. |
| Settled by cash payment | Cash paid normally stays with the seller unless the contract transfers it. If it was not spent on repairs, the new owner has no further EQC entitlement for that same damage. |
| Settled, repairs incomplete | The buyer’s remaining entitlement may be zero, and insurance for future events may be harder to arrange. |
| Reopened | A settled claim can be reopened for missed natural-hazard damage, or for Canterbury managed-repair claims where repairs did not meet statutory replacement standards. |
These points come from the NHC page on buying or selling with previous claims and from an EQC factsheet on assigning claims, which makes clear that an assigned claim does not guarantee a payment. Where a claim has been settled up to the statutory limit, nothing further may be available.
If a claim is reopened after you sell, the new owner has to provide the relevant expert reports they received after purchase. That is one more reason to be upfront about what you know.
What you need to disclose and have ready
You must answer buyers’ questions honestly. Settled.govt.nz says buyers or their agents may ask you for:
- NHC and insurance claim documents and policy numbers
- Engineer reports
- The NHC scope of work
- Payment details
- Repair sign-offs
- Building consents and Code Compliance Certificates
- Builder guarantees or warranties
Gather these into one folder before anyone asks. A complete file shortens negotiations and lowers the chance a buyer asks for a price drop “just in case”. If you have lost documents, ask your insurer or NHC for copies, and tell your lawyer what is missing.
Honest disclosure is also the best protection for you. Our pieces on the role of transparency in home sales and property defects NZ sellers must know about go into the principles in more detail.
What buyers should check
If you are on the other side of the table, or you are selling to someone who is careful, here is the checklist Consumer Protection recommends:
- Identify every insurer involved.
- Work out whether each claim was settled in cash or through managed repair.
- Look at proof of payments and proof of repairs.
- Make claim transfer a condition of the purchase, using a DOA checked by the buyer’s lawyer.
Sellers who expect these questions and have the answers ready tend to find the process far smoother.
How to arrange the assignment
The parties can assign a claim with a clause in the sale and purchase agreement or with a DOA. NHC says a DOA should include:
- The property address
- The date of the DOA and its effective date
- The names of all assignors and assignees
- The purchaser’s contact details
- Witnessed signatures
- The claim numbers
If only some claims are transferring, list only those claims. NHC also advises both sides to get legal advice and to talk to their insurer. Your conveyancer or lawyer should draft or check the document. The legal side of a sale is covered more broadly in our notes on legal considerations when selling property and on real estate agreements and the standard forms.
A short worked example
Say you own a house with a settled earthquake claim. NHC paid you cash, and you fixed part of the damage. A buyer’s lawyer asks for the scope of work, the payment record and evidence of the repairs.
You can show the payment and the repairs done, but one section of the work was never finished. The buyer now knows the remaining entitlement is probably nil, and that the unfinished repair could affect insurance. They can price that in, ask you to complete the work, or walk away.
Compare that with a seller who has all the paperwork, states clearly what was and was not repaired, and has a lawyer ready with a DOA. The facts are the same, but the conversation is calmer and the negotiation faster. That is the practical role of an EQC claim in a sale: it is information, and the sooner it is organised the less it costs you.
Our view on EQC claims and selling
We talk to homeowners every week who feel stuck because of a claim history. Some have a half-finished repair, some have inherited a house with no file at all, and some are separating and need a quiet, quick outcome.
Our view is that a claim should not be the thing that stops you moving on. A traditional sale asks the house to look its best, the paperwork to be complete and the buyer’s finance to line up. That is a lot to ask when the property is damaged or the situation is urgent.
That is why we offer a direct, private sale. We buy properties in any condition, with no agent, no commission and no repairs required, and we settle on the timeline that suits you. We are designed to take a house as it is, including homes with natural-disaster damage, unconsented work or tenants in place.
Whatever route you choose, gather your claim documents and speak to your lawyer first. Knowing where you stand puts you in control of the decision.
Aaron
When a direct sale makes sense
A conventional listing suits a tidy house with a clean file. Several situations point to a direct sale instead:
- Damaged or unrepaired homes. If repairs are incomplete and you do not want to fund them, selling as-is removes the repair question from the sale.
- Inherited houses. Estates often lack claim paperwork. Our estate sale service is built for that.
- Separations. A private process helps when you need a discreet sale after separation.
- Tenanted rentals with damage. Landlords can sell without evicting or repairing first.
- Tight deadlines. If you need to move quickly, see how a fast sale within 7 days works.
A cash sale does not remove your obligation to be honest about what you know, and your lawyer still reviews the contract. What it can remove is the marketing period, agent fees and the need to repair.
Get a no-obligation offer
We buy homes across New Zealand in any condition, including those with an EQC claim history. You send us the property details, receive a no-obligation offer, and settle on your preferred timeline, with no agent and no commission fees.
To see how it works, visit easySale or read about selling your house privately. If you are still planning, our checklist for a fast property sale helps you get organised.
FAQ
Does an EQC claim have to be disclosed when I sell?
You must answer buyers’ questions honestly, and they may ask for claim documents, scopes of work, payment details and repair evidence. Settled.govt.nz sets out what they commonly request. Your lawyer can tell you what to volunteer and how to word it.
If I do nothing, does the buyer get my EQC claim?
No. If the property is sold without the claim being assigned, the rights and benefits remain with the previous owner. To pass the claim on, the sale contract needs a clause or the parties need a Deed of Assignment.
Will I have to hand over money I have already received?
Normally not. Funds already paid to you stay with you unless the sale contract says they transfer. The buyer’s entitlement is limited to what remains, and it may be nothing if the claim was already settled.
Can a settled claim be reopened after I sell?
Possibly. NHC says a qualifying settled claim can be reopened for missed natural-hazard damage, or for certain Canterbury managed-repair claims where repairs did not meet the required standard. The new owner must supply the relevant expert reports they obtained after buying.
Can I sell a damaged house without finishing the repairs?
Yes. You can sell as-is, but the buyer will weigh the damage and the claim status in their offer. Incomplete repairs may affect their ability to get insurance, so be clear about what was and was not done.
Sources
- Buying or selling a home with previous claims, Natural Hazards Commission
- Buying a house after a natural disaster, Consumer Protection
- Selling after a natural disaster, Settled.govt.nz
- Assignment of claims with earthquake damage factsheet, EQC
