Frustration over latest EQC transferrals

Frustration over latest EQC transferrals | Insurance Business

Frustration over latest EQC transferrals
The Insurance Council of New Zealand (ICNZ) has revealed the amount that private insurers have paid out on Canterbury claims has now hit $15 billion, of which $6 billion was for domestic claims.

Insurance companies have settled almost 15,000 over cap residential claims including 1,100 in the quarter to 31 March 2015, equivalent to 12 properties a day.

A further 275 cases were transferred from the EQC in the first three months of the year, which, while it was down from the 744 cases transferred in the previous quarter, still left ICNZ members with a great deal of uncertainty at what was yet to come.

ICNZ CEO Tim Grafton said: “Insurers are working constructively with EQC to better understand how many more will be coming over in 2015 because we’re mindful that there are still customers who have yet to be transferred to their insurer or are in dispute with EQC over the status of their claim,” Grafton said.

“It’s not only frustrating for the remaining customers who are still to be given a clear pathway to resolution but also insurers who still don’t know what their total liability is going to be.”

Grafton said ICNZ was urging customers in dispute with EQC – whether over or under cap – to make sure their insurer was aware that they were still in negotiation.

The release of the figures follows weekend media reports that insurers have lost confidence in what they have described as EQC’s ‘poor’ data.

EQC CEO Ian Simpson had estimated around 200 cases were set to follow the 275 but one industry source told Fairfax Media: “[Insurers’] experience is that the quality of EQC data is so poor that they have little confidence in EQC’s forecasts.”

There was concern that the drop in claims merely reflected the slower summer months and the true figures would be considerably higher.

Simpson had defended EQC’s data saying it was ‘as good as that used by the rest of the industry’.

Meanwhile, ICNZ revealed 71% was the latest figure for over cap residential claims that have been resolved or fully settled with a further 23% of 24,000 over cap claims in resolution.

Insurers had repaired or rebuilt 567 houses through private insurer-managed programs by the end of March 2015 bringing the total completed repairs and rebuilds to 3,457.

Grafton said the process was still taking a lot longer than many insurers had hoped.

“Some insurers have responded by actively encouraging customers to look at cash settlement options, which allows customers to settle their claim and to take control of their repair/rebuild program now rather than join an insurer-managed rebuild or repair queue,” he said.

To date, 11,200 over cap claims have been cash settled, with around 6,000 of them being red zone.

The number of customers still to receive offers from their private insurer was down to 570 and there were 430 customers who had yet to make decisions on the offers they’d received.

For claims out of the scope of EQC, 89% of the 64,576 had been fully settled.