Private insurers reassure Canterbury residents

18 December 2015
Private insurers reassure Canterbury residents

Private insurers today moved to reassure customers that they will not use Limitations Act defences for residential claims arising out of the Canterbury Earthquakes where proceedings are filed before 4 September 2017.

“Unnecessary concern has been raised that unless customers file cases in Court before 4 September 2016, six years after the first earthquake, that insurers would seek to avoid claims by relying on the Act,” Insurance Council Chief Executive Tim Grafton said.

“Today’s announcement will put people at ease and avoid the need to worry about rushing to Court and incurring costs to protect a legal position,” he said.

ICNZ members AA Insurance, FMG, the IAG brands, MAS, Tower and Vero have agreed not to plead a defence under the Limitation Act 1950 or the Limitation Act 2010 for any residential claim relating to the Canterbury Earthquakes where proceedings are filed in the Courts before 4 September 2017.

“There are different legal interpretations of when the six-year limitation period begins and there are also different policy wordings as well as the facts of particular claims,” he said.

Having taken stock of their respective legal, governance and reinsurance positions, our members have agreed that 4 September 2017 is the earliest date a Limitations Act defence may be used. This minimum time extension has been agreed in the interests of customers. By that date, we fully expect almost all claims to be settled.

This decision means residents with Canterbury claims can have peace of mind on this issue and continue to focus on reaching settlement with their insurer. If customers are in any doubts about their position they should speak to their insurer.

The Limitations Act applies to any claim made in the courts, not just insurance claims. It gives a defence where more than six years have elapsed since the act or omission giving rise to the claim. The intention of the Act is to ensure that claimants do not cause undue delay bringing claims to court and provides certainty to defendants.

ENDS

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