Blenheim residents say AA Insurance has stopped offering new home insurance policies in their town, following similar decisions in Westport and parts of greater Christchurch.
The insurer would not confirm that Blenheim, and the neighbouring settlements of Renwick and Seddon, were subject to its temporary halt.
However, several residents contacted RNZ to say a blanket exclusion for new policies appeared to be in place.
AA Insurance's online portal declined to provide quotes for a dozen addresses that RNZ tried across the three locations.
A message onscreen said the company was unable to offer insurance because of "the suburb or town where your home is located".
RNZ revealed last week that the company had halted new home, business and landlord insurance policies in the West Coast town of Westport, due to the high flood risk the town faces.
The insurer had also stopped offering new policies in north Canterbury township Woodend, along with Rolleston and Lincoln, RNZ reported on Tuesday.
There, AA Insurance said that it had reached its maximum exposure limit to seismic risk.
The company would not confirm if new policies in Blenheim were being declined for the same reason, or for flood risk like Westport.
Parts the wider Blenheim area flooded last winter after the wettest June on record since 1942, and some residents in Renwick were evacuated.
AA Insurance head of underwriting Dee Naidu said managing risk exposure was common practice in the insurance industry and the list of areas with temporary restrictions was not static.
"We are always monitoring where we are growing and the accumulation and exposure to risk from that growth. We have no plans to introduce any new temporary restrictions beyond those that have been previously reported on."
None of the restrictions affected existing customers, Naidu said.
Blenheim woman Shelley Tapp moved to the town at the end of last year and was surprised when AA Insurance turned down cover for a house she was trying to buy.
The agent she spoke with on the phone was unable to provide any detail, she said.
"I asked him why, and he said, 'I can't tell you why, it's just too high risk.'"
Tapp and her husband inspected council records and previous insurance claims and could see no problem with the property.
"That particular property has never had earthquake damage, it doesn't have any claims for flooding."
Tapp said she asked the real estate agent, who told her that AA Insurance was declining new cover for the 7201 postcode, which encompassed Blenheim.
The couple ended up buying a different house, insuring it with AMI instead of AA Insurance.
"I thought there's no point me going back to AA because they told me no."
The company needed to be transparent with people about why it was declining cover in certain areas, Tapp said.
"I think other insurance companies do it as well. It creates uncertainty around the property - you think, is it something wroing with the property itself?"
Other residents who got in touch with RNZ reported a similar experience.
"We enquired about insuring a new build in Blenheim yesterday and discovered that AA have blacklisted Blenheim," one said.
Another said he had his request for home and contents cover in Blenheim declined "because they said they were not taking on any more risk here".
A third person, who had been insured with AA Insurance for a decade in his previous house, said he and his wife were unable to get a new policy when they moved within Blenheim in May last year.
"They would not insure the new house at all. The advisor was apologetic and mentioned they wouldn't be covering Blenheim due to the risk."
In a written statement, Finance Minister Nicola Willis said it was up to individual businesses to decide how they managed their exposure to risk.
Treasury's annual insurance monitoring surveys "indicate that there is reasonable availability of online insurance quotes in areas of higher seismic risk", she said.
The Natural Hazards Commission declined to comment, referring questions to the Insurance Council.
An Insurance Council spokesperson said insurance remained generally available across New Zealand.
"The insurance industry has consistently said it's important New Zealand takes a long-term view on the risks from natural hazards as we face the prospect of more frequent and severe events due to climate-related events."
The council supported "a government-led approach to mitigate and adapt to changing climate and an agreed set of natural hazard and climate risk data so we are all on the same page".
The current Natural Hazards Commission levy, and the cap the commission paid out for natural hazards claims, were sufficient to maintain insurer confidence, the spokesperson said.
"The real solution lies in proactively reducing underlying risk, including avoiding development in high-risk areas, investing in resilient infrastructure, improving building standards, and sharing consistent natural hazard data.
"These steps would reduce losses and signal to global reinsurers that New Zealand is managing its risk exposure, helping to stabilise costs."
