Not At Fault But Still Paying Excess? The Truth About NZ Car Insurance Rules (2026)

Introduction

Short answer: being not at fault does not automatically mean you will pay no excess on a New Zealand car-insurance claim. Whether an excess is waived, charged first and potentially refunded, or remains payable depends on your policy wording and the evidence available to your insurer.

An excess is the amount you agreed to contribute towards the cost of damage on an accepted claim. In our editorial review, the key issue is not simply who you believe caused the crash: it is whether the policy's specific no-fault excess conditions have been met.

This is general information, not personal insurance or legal advice. Before making a claim or changing cover, check your current policy schedule and wording. You can also use our New Zealand car insurance guide to help frame the wider comparison.

Why a not-at-fault driver may still pay excess

Consumer Protection NZ says a driver who was not at fault may have excess waived or refunded when they can prove they were not at fault and obtain the other driver's name, address and telephone number. That is a possibility, not an automatic rule for every claim or every insurer.

Policies set their own conditions. The insurer may need enough information to identify the other party and assess responsibility under its wording. If key details are missing, the accident circumstances are disputed, or the relevant policy condition is not satisfied, the normal excess may still apply.

Do not assume an excess outcome from a roadside conversation alone. Give the insurer the information and evidence you have, then ask how its no-fault excess provision applies to your claim.

What policy wording can change: current insurer examples

When we compare policy information, we look closely at the exact conditions rather than treating “not at fault” as a standard industry-wide test. The following examples show why that matters.

These are insurer-specific published examples, not a recommendation or a promise of cover. A registration number alone is not universally enough, and neither is there one universal list of waiver requirements.

Excess is a policy term—and more than one may apply

Your policy documents set the excess you agreed to pay and explain how it applies. Consumer Protection NZ cautions that more than one excess can be payable depending on the policy terms, including where an event involves two policies.

That does not mean every claim will involve multiple excesses, nor that all insurers use the same categories. Rather than relying on a generic list of “standard”, age, licence or other excesses, check your own schedule and wording for:

• the standard excess for the vehicle and cover selected;
• any additional excesses or circumstances in which they apply;
• windscreen or glass provisions, which may be treated differently from the usual excess rule; and
• the no-fault excess wording, including required third-party details and evidence.

Higher excess: a premium trade-off, not a free saving

Choosing a higher excess can reduce your premium, because you agree to contribute more if you claim. But the amount of any premium reduction is specific to the vehicle, drivers, location, insurer and cover selected. It should not be assumed from another person's quote.

Our team suggests making the choice around claim-time affordability. Ask yourself whether you could pay the selected excess if a claim arose before any no-fault waiver or refund decision. If you are considering a high general excess, also check how windscreen or glass claims are treated and whether a separate glass option is available.

After a crash: protect the information your claim may need

At the scene, focus first on safety. When it is appropriate to exchange details, record the other vehicle's registration and the other driver's contact details. Consumer Protection NZ specifically identifies the other driver's name, address and telephone number as important for a possible no-fault waiver or refund.

Also preserve available evidence: photographs, dashcam footage, a clear account of what happened, and witness contact details. A roadside statement may be useful context, but it does not itself guarantee an excess waiver. Send the information promptly and ask the insurer to assess the claim against the current policy wording.

How to challenge an excess decision

If you think an excess decision does not match your policy, first ask the insurer to identify the relevant wording and explain what information or condition it considers outstanding. Keep copies of your claim correspondence and the evidence supplied.

1. Make a formal complaint to the insurer. State the outcome you seek and attach the relevant policy wording, claim reference and evidence.
2. Use the insurer's complaint process. Under the Fair Insurance Code information published by ICNZ, code-member insurers should acknowledge a formal complaint within five business days and respond within 10 business days. If unresolved within two months, they must advise the customer of the right to external dispute resolution.
3. Contact the scheme named by your insurer if needed. Consumer Protection NZ says retail financial service providers must belong to a free independent dispute-resolution scheme. Insurance policy and claim-decision disputes can be taken to that scheme after you have raised the matter with the provider.

Do not assume the relevant scheme will always be IFSO. Use the independent dispute-resolution scheme identified by your own insurer.

2026 legal-status note

As at 17 August 2026, the Contracts of Insurance Act 2024 does not create a general current right to a no-fault excess waiver. Its provisions come into force on dates set by Order in Council, with any part still uncommenced coming into force by 15 November 2027. The official legislation page currently records no commencement order for the Act itself. For a motor claim today, the immediate starting point remains your current policy wording and the claim facts.

Practical Takeaway

• Do not treat “not at fault” as an automatic exemption from excess.
• Read the no-fault excess clause before you need it; identify the third-party details and proof your insurer asks for.
• Keep the chosen excess affordable, even if you expect another driver to be responsible.
• Check for separate glass provisions and any additional-excess terms in your own policy.
• If you disagree with the decision, complain to the insurer first, then use its named independent dispute-resolution scheme if the matter remains unresolved.

References

• Consumer Protection NZ (MBIE): Car insurance
• Consumer Protection NZ (MBIE): Insurance
• Consumer Protection NZ (MBIE): Making a complaint about your financial service provider
• New Zealand Legislation: Contracts of Insurance Act 2024
• Insurance Council of New Zealand: About the Fair Insurance Code
• Insurance Council of New Zealand: How to Make an Insurance Complaint
• Tower: Comprehensive Car Insurance
• AMI: Will I have to pay the excess if a motor accident isn't my fault?

Author / Editorial Team

This article was produced by Insurspy's internal editorial and research team. In our editorial review, we compare publicly available policy information, prioritise authoritative New Zealand government, legislation, industry and insurer sources, and update content for accuracy and practical usefulness. Insurance terms, eligibility and claim decisions differ by policy and circumstances, so readers should confirm the current wording with their insurer.