21 February 2016

Canterbury five year anniversary statement

The fifth anniversary of the Canterbury earthquakes, is a time to remember those who lost their lives, the massive recovery effort since and to look to the great future Christchurch has ahead.

Tim Grafton, Chief Executive of the Insurance Council said “the insurance industry is proud of its contribution. Our members have settled $17 billion of residential and commercial claims or 90% by number of claims. This has enabled better, modern, safer houses to be built”.

This has been achieved in the face of one of the largest, most complex insurance events globally while continuing to maintain insurance cover throughout to support people and the economy. Our country lost the equivalent of 20% of our GDP when the quakes struck, yet Canterbury has not only survived, but thrives.

We understand the frustration experienced by people who have suffered from such a major event. But looking back, our industry has at time been the convenient by-word for delays. In many instances, delays were not of insurers’ making and were beyond their control. These are some of the many reasons:
- Land was unstable with many earthquakes, including major damaging ones, for over a year after 22 February 2011, stalling a major repair and rebuild programme

- Thousands of properties needed to have geo-tech tests to determine the damage to the land and the unique foundation solutions for those properties

- Land was zoned and new building codes introduced

- Long delays occurred in the consenting and council inspection processes

- Skill and material shortages constantly disrupted the rebuild process

- Underground service connections were poorly mapped and disconnections and reconnections on sites caused significant delays

- Contaminated land sites were identified and needed to be cleaned up

- Mass land movement areas across the Port Hills had to be scientifically identified and assessed

- Land remediation for liquefied land was researched and developed from scratch

- Ways of compensating people for land damage had to be developed

- The legal complexities and agreements required to progress multi-unit buildings on cross-lease titles where at times people are uninsured.

“This is not to say mistakes were not made, but best endeavours have been made to genuinely make progress as quickly as possible. We have learned from what happened, we have made changes and believe more can be done to improve the response to the next event when it happens” he said.

Many insurers have now moved to a sum insured instead of open-ended replacement. This will provide certainty for all parties as to the value of settlement.

Grafton said “We believe for a future natural disaster that the Government should make changes so that all claims are lodged with your insurer who should have responsibility for assessing the claim. This would mean that the worst damaged houses would be identified by insurers early instead of receiving almost 1,500 properties from EQC during 2015”.

Protestors have misleadingly said claims have not been honoured. This is not true. Where there is disagreement about the scope of repair, insurers must rely on independent experts like engineers to advise them. If there are differences of opinion then insurers have helped fund an independent Residential Advisory Service to provide free legal advice and technical assessments for second opinions. Some insurers have engaged specialists with the soft skills to help claimants through the settlement process.

Five years on from the big one, insurers and the Cantabrians that work for them continue to put every effort in to settle claims for their own community.

ENDS

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