New Zealand insurers have called for a “simple, durable” levy on fixed assets such as property to replace the premium duty that funds fire and emergency services.

The Insurance Council of NZ says its proposed community protection levy would raise $NZ600-$NZ700 million ($494-$577 million) a year and be directed to natural hazard resilience projects.

The council has long pushed for changes to the way Fire and Emergency New Zealand is funded, arguing the current arrangement is unfair on insureds.

Under the present model, different charges are applied on home, contents, commercial property and vehicle policyholders.

“New Zealand needs to invest more in reducing risk before disasters happen,” council CEO Kris Faafoi said.

“A community protection levy would provide a simple, durable way to fund resilience, while ensuring FENZ has the secure Crown funding it deserves.

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“FENZ plays a vital role in protecting communities and responding when disasters strike. But the current levy is too complex, too uneven and no longer well suited to the risks New Zealand faces today.”

The council says the community protection levy would apply to fixed assets based on sums insured, with a cap for residential properties.

Motor vehicles would be excluded, but owners would contribute to FENZ through a charge on car registration.

The council says insurers would collect the community protection levy on behalf of government.

“Internationally, fire and emergency services are typically funded through central or local government, or through property-based levies rather than insurance premiums,” the council said.

“A community protection levy would replace the current levy with a simpler system that funds resilience rather than recovery.”