Every time New Zealand has a period of heavy rain, we see multiple stories of vehicles becoming stuck on flooded roads. Below, we discuss the insurance issues drivers may face if their vehicle is damaged by flood waters.

If you have fully comprehensive vehicle insurance, you are insured for accidental physical loss of, or damage to, your car. For example, if your car was parked at the side of the road and it was swept out to sea by flood waters, your insurance would pay out because you'd physically lost it. If it was parked at the side of a river which burst its banks and the car was swamped by flood waters, as a result, the physical damage would also normally be covered.

The situation is different if you have chosen to drive through standing flood water. Most policies include a requirement to take reasonable care of your vehicle. There is always a term of the policy which excludes damage caused following intentional or reckless conduct. That is, where you knew that damage would result, or took an intentional risk knowing that damage might be caused.

If you've made a claim and the insurer is considering declining cover, remember that it is not always reckless to drive in flood waters – in certain areas, flooding is a fact of life. The AA publishes guidance on how to drive through flood waters safely: https://www.theaa.com/driving-advice/seasonal/driving-through-flood-water. There are also theory questions on the driving test devoted to assessing flooding risk: https://www.drivingtests.co.nz/resources/how-to-drive-through-a-flood/. Insurers must accept there will be a certain level of driving through flood waters.

Whether your policy covers damage caused by driving through flood waters is a matter of degree. For example, if you're driving your four-wheel drive vehicle on an open public road, with seemingly shallow surface water, you are probably not acting recklessly if your car is damaged after driving into a concealed pothole and is subsequently swamped. However, if you're driving your small hatchback on an unsealed public road, and decide to cross a swollen stream, the insurer will probably be entitled to determine you've been reckless and decline cover for damage.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.