Property sales near completion in Wellington and Marlborough are being put on hold because insurers are refusing to issue new policies in the wake of recent earthquakes.
The Insurance Council says its members have begun putting exclusion zones on new home insurance policies from Wairarapa down to Marlborough until seismic activity settles down.
Mortgage Brokers Association spokesperson Jenny Campbell says the hold is delaying settlements, as banks won't lend money for properties until they have insurance.
She says brokers she has spoken to are angered by the delays, and there are cases where moving trucks are sitting in driveways because mortgage settlements are in limbo.
Real Estate Institute Wellington manager Euon Murrell also understands transactions are being put on hold because of the freeze, and wants insurers to continue issuing new policies, especially if a house already has insurance.
Insurance Council spokesperson John Lucas says he is not sure how many of its 27 members have put the hold in place, but they choose to do so independently. He says companies did the same thing after the major Christchurch earthquakes.
"It is quite common, insurers need to do this and they need to liaise with their reinsurers as well. But we're not expecting this to be a fairly long process - it could be over in a matter of weeks, or even days."
AA Insurance has stopped issuing new home insurance from Masterton across to Otaki and down to Marlborough until the seismic activity has settled. The company is seeking geotechnical advice and says it will reconsider its position daily.
Spokesperson Suzanne Wolton says AA Insurance will still give home buyers insurance, but only if they are purchasing a house already insured by the company.
