New Zealand’s no-fault accident insurer, the Accident Compensation Corporation (ACC), cut rates on April 1 and reported solvency of 99.9% at December 31.

ACC Minister Nikki Kaye says lower levies are possible because the scheme is essentially fully funded.

“This is a far cry from six years ago, when we inherited a scheme that saw the gap between its assets and liabilities grow by $NZ4.8 billion ($4.7 billion) in one year alone,” she said.

The ACC has cut the average levy paid by employers and self-employed people by 5%, while the average motor vehicle levy will fall by about 41% from July 1.

From that date cars will be risk-rated. The levies for specific makes and models will be published later this month.

Significant drops in discount rates mean the ACC has recorded a surplus of $NZ80 million ($78.49 million) so far this financial year, rather than the $NZ562 million ($551 million) budgeted, as the outstanding claims liability rises.

Performance from insurance operations of $NZ765 million ($750.59 million) is $NZ203 million ($199.18 million) above budget.