Fact sheet: EQC privacy breach
2 April 2013

In recent days, there has been a lot of discussion, in media and elsewhere about EQC’s breach of customer privacy. EQC has taken the breaches very seriously and has provided as much information as it could. We hope the following information is helpful in clarifying some of the issues that have been raised and informing our customers of their impact.

Customer impacts of the IT systems shut down

The suspension of many of our information technology and email systems has changed the way we are working in the short-term. The EQC call centre is operating as usual but there will be impacts on customers as follows:

1. Claims processing will be delayed, including payment of claims
2. Assessments of damaged land and buildings scheduled for this morning were delayed
3. Online forms, such as the query form, OIA request form, complaints form are down until the website is up (expected to be up by 4 April)
4. EQC staff cannot email documents to customers.

What information was released in the privacy breaches

The major breach on Friday 22 March involved the release of claim information relating to 83,000 customers whose homes are in the Canterbury Home Repair Programme. (There are approximately 177,000 damaged residences in Canterbury.) This included information about assessments, including some confidential information relating to scopes of works.

While the information should not have been released, it should have no impact on customers as their homes will be repaired regardless of the assessments and the values in the scope of work.

The information released in the privacy breach notified on Thursday 28 March did not provide bank account numbers. EQC cheque numbers for cancelled cheques were listed however.

It has also been alleged in media that EQC staff “laughed off” a privacy breach notification. EQC records call centre contact and a review of the relevant calls showed that the caller was treated respectfully.

EQC’s repair costs – why they are confidential

Following the March 22 privacy breach, some customers have questioned why EQC’s estimate of the value of damage sometimes differs from the amount we pay to repair contractors or the homeowner, and why it is kept confidential.

EQC’s repair costings change over time for several reasons. The initial assessment of damage (pre-Feb 2011) may be a very broad estimate to enable us to form an early view on how the claim should proceed. It’s not uncommon for significant variations between older and more recent assessments as staff gained experience in identifying and costing damage.

In the end, however, these assessments are superseded by the scoping of damage and pricing for repair work that occurs immediately prior to repairs. Whatever indicative figure EQC was using prior to that becomes irrelevant.

However, EQC must keep this figure confidential to maintain the “competitive tension” in the market that enables us to get quotes that reflect the market. That means we pay the fair market rate, and aren’t paying out more taxpayer and levy-payer money than is necessary to do the work.

How EQC is settling building claims

EQC has set as a priority the repair of homes with more than $50,000 worth of damage. However, we still intend to repair homes with lesser damage – between $15,000 and $50,000 – with a targeted completion date for the last house of 2015.

EQC has the option to repair or cash settle building damage. For properties between $15,000 and $100,000 damage we choose to repair in order that:

• EQC settlements go into housing repairs, ensuring the quality of housing stock
• We guard against sharp price rises for building and finishing trades, which lower the value of insurance pay outs
• We create efficiencies in the home repair process to ensure the last house is fixed sooner than if every homeowner were competing to get work done
• We create safeguards to ensure substandard or unfinished work is completed and keep fly-by-night operators at bay.

ENDS

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