Youi New Zealand is continuing to underwrite home and contents cover in areas hit by a powerful earthquake last month, bucking conventional practice to embargo new business after a major natural disaster.

“I confirm we are continuing to provide home and contents cover in those areas generally and we are pleased to be open to offer insurance to those customers,” a Youi spokesman told insuranceNEWS.com.au.

“There may be some individual instances where we cannot provide cover. This is in the minority and depends on individual circumstances.

“We are confident with our underwriting approach, which is centred around understanding risk and pricing it accurately.”

The 7.8-magnitude quake struck on November 14 near the small town of Hanmer Springs, about 100km from Christchurch, which was devastated by the 2010/11 quakes.

Parts of Wellington in the lower North Island also felt the powerful tremors.

The Insurance Council of New Zealand says insurers typically ban new business or requests to increase cover following a major natural disaster.

“The reason for insurers to be cautious is to minimise additional losses, to meet reinsurers’ needs and keep insurance affordable for all,” it says. “Insurers need to make prudent decisions to minimise the risks they take on in an uncertain environment.”