Private Insurers attempt to overstate progress as fifth anniversary of February Canterbury Earthquake approaches

The Private Insurance industry continue to try to overstate the rate of progress in insurance settlements as a result of the Canterbury Earthquakes.

Today a press release was issued by the CEO of the Insurance Council of New Zealand:

http://www.scoop.co.nz/stories/BU1602/S00015/insurers-settle-20-more-claims-in-2015.htm

The Chief Executive of the lobby group, Mr Tim Grafton today stated:

“Nearly 5,400 major repairs and rebuilds were completed in 2015 which reflected a 21% rise in the settlement rate last year compared with 2014”.

However Mr Grafton is incorrect.

If the data provided by the Insurance Council’s members is be to believed, they have cumulatively completed nearly 5,400 major repairs and rebuilds in total for the 5+ years ended 31 December 2015 (since the first earthquake), and not in the 2015 year as stated by Mr Graton.

The data supporting Mr Graton’s statement, which is supplied to the Insurance Council by the its private insurance company members, via the Ministry of Business Innovation and Employment (MBIE), clearly show that in the 5+ years since the earthquake sequence began, only 2,430 repairs and 2,865 rebuilds have been completed by its members in Canterbury:

http://www.icnz.org.nz/wp-content/uploads/Canterbury-Earthquake-Progress-Stats-Q4-2015.pdf

The Insurance Council data states that after 5+ years, out of the 25,000 ‘over EQC cap’ claims, only 2,430 repairs have been completed and 2,865 rebuilds have been completed, with the vast majority (13,663 or 72% of all settlements) have been settled in cash.

Of more concern is the fact that repairs and rebuilds are slowing down, not accelerating as stated by Mr Grafton.

Southern Response, the Crown entity charged with settling 7,800 of the 25,000 claims reported today by the Insurance Council, have only completed 967 rebuilds and 569 repairs after more than 5 years, with progress slowing:

http://southernresponse.co.nz/images/documents/Progress_to_the_end_of_December_2015.pdf

Christchurch Chartered Accountant Cam Preston, stated today:

“Statistics for the other insurers are not available as they simply refuse to release them, and when they do they are over-stated or incorrect. Not only are the Mr Grafton’s statements wrong, but further they hide the reality which is that private insurance industry are less than 50% of the way through their repair and rebuild programmes, and more worryingly they are actually slowing down. The delays to rebuilds and repairs are designed to save the insurers money by wearing down policyholders down, who after 5+ years are running out of patience and simply throwing in the towel and accepting low ball cash offers”.

ENDS

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