Concerns mounting over insurance companies in South
Labour West Coast/ Tasman MP
Wednesday, 16 March 2011 MEDIA STATEMENT
Concerns mounting over insurance companies refusing cover in the South Island
Insurance companies need to keep offering insurance for South Island people and businesses despite the Christchurch earthquake, Labour Rural Affairs spokesman Damien O’Connor says.
“Concern is mounting that some insurance companies may be operating a blanket no South Island coverage position. That’s not good enough.
“Refusal by insurance companies to cover new house owners in the South Island as a result of the Christchurch earthquake is outrageous, and will seriously impact the area’s economy,” Damien O’Connor said
“I am aware of a house purchase being blocked in Westport because of an inability to purchase insurance and stories are emerging from Picton and other towns in the South Island.
“What the South Island does not need is insurance companies blocking business and relocations in an attempt to cut their losses. While we can all understand the impact on their downside, they are in the business of risk management, not risk aversion.
“They happily take premiums for years for events that rarely occur. When they do their own insurance kicks in and the wheels of commerce continue. That is the way the risk is shared.
“The question is whether the National Government was aware of this change and if so, what will it now take to get the policy reversed? Otherwise Christchurch and the entire South Island will come to a grinding halt,” said Damien O’Connor.
“Insurance companies operating a blanket no coverage in the South Island area must be up front about what they are doing and the Government needs to be upfront with the public about what it is doing about the situation.
“At this time the last thing the economy needs is insurance companies refusing to cover entire regions,” Damien O’Connor said.