Latest Canterbury stats underline need for change

Latest Canterbury stats underline need for change | Insurance Business

Latest Canterbury stats underline need for change
Insurers have received an extra 403 properties from the Earthquake Commission (EQC) in the last quarter, taking the total to 1,553 for the last 12 months, according to figures released today by the Insurance Council of New Zealand (ICNZ).

The fact ICNZ is still receiving hundreds of claims more than five years after the earthquakes highlights how important it is for the current system for assessing claims to be overhauled, ICNZ CEO Tim Grafton said.

“It is extremely frustrating for homeowners and insurers to be receiving so many new property claims five and a half years after the events, which stresses the need for changes in the future.

“Insurers should do all assessments for future natural disasters so that the most damaged properties can be rebuilt or repaired much sooner,” he said.

ICNZ said private insurers had now fully settled 20,000 over cap residential property claims, which is 91% of all Canterbury earthquake residential properties.

“This represents 20,000 over cap and 63,000 out of scope properties,” Grafton said. “We have also settled 93% of commercial claims worth $9.6 billion as at 31 March 2016.”

Based on data jointly collected by ICNZ and the Ministry of Business, Innovation and Employment (MBIE), 84% (21,588) of all over cap residential claims are resolved or have been fully settled.

Resolved means the repair/rebuild is under construction, in consenting or a building contract has been signed.

A further 12% (3,112) of the 25,753 over cap properties are in resolution, meaning the rebuild/repair is in the pricing and design process or cash settlement is pending.

Insurers have completed 5,715 major repairs and rebuilds and cash settled 14,283 properties to the end of March 2016, ICNZ said.

The number of customers who are still to receive offers from their private insurer is down to 275 and there are 407 properties where people have yet to make decisions on the offers they’ve received.

Meanwhile, EQC has today announced it is introducing a faster handover process for the remaining dwelling claims likely to be cap, with the backing of insurers IAG and Southern Response, who have the most over cap customers.

EQC said the process would begin this week for 300 properties that are likely to go over cap and would involve working closely with both insurers.

EQC general manager of customer and claims, Trish Keith, said the remaining claims were complex and among the most difficult to resolve.

“We want to ensure that the relatively small number of remaining customers’ dwelling claims move forward as quickly as possible.

“It’s because of this that EQC is adopting a new approach to expedite the process for these claims in appropriate cases.”

The roughly 300 customers whose dwelling claims are likely to go over cap will now be phoned by EQC in the next few weeks.

“We will discuss with them how the process will affect their individual claim and how they can expect a call from their insurer who will take on full responsibility for managing the claim from then onwards,” Keith said.

Transfers under the old process took several months but the objective now was to do it in a matter of weeks but still in a managed way.

“We are looking to eventually work with all major insurers to enable faster handover of claims. This process also gives insurers increased clarity of the numbers and details of specific properties to be transferred to them,” Keith said.

IAG’s customer reinstatement general manager, Renee Walker, said IAG was always looking for faster ways to resolve claims for its customers.

“This new approach will help speed up the process going forward,” she said.

Southern Response general manager strategic communications Linda Falwasser also welcomed the faster handover.

“Getting Cantabrians back into homes as quickly as possible is the priority for everyone.”