It’s been a big week for earthquake claims payouts after the record $550 million settlement with Canterbury University made history on Tuesday and
Insurance Business decided to ask how things are looking for those insurers working on both residential and commercial claims.
The overall message is that resolutions are gathering momentum with 2015 shaping up to be a big year for those trickier, more complex claims.
That said, with new claims still being transferred from the Earthquake Commission to insurers at a considerable rate – over 1,140 in the 12 months to 1 October 2014 – there will be ongoing industry concern that more than four years after the September 2010 earthquake the total liabilities for the Canterbury earthquakes are still not known.
AA Insurance:
The direct insurer says it has reached a total of 91% home insurance claims settled and resolved as of 17 November 2014. This includes claims that are cash settled, where construction is complete, or a construction contract has been signed.
On its website the company outlines where it is heading next year: “In 2015 our focus will be on completing construction for the remaining customers with more complex home claims; such as shared properties, multi-unit buildings and homes on damaged land that requires significant reinstatement work.
“We are working closely with the Earthquake Commission and other insurers to settle these claims as quickly and efficiently as possible.”
Vero:
Vero reports it has resolved and settled 86% of all its residential claims including more than 70% of over cap claims, as of 2 December 2014.
The company expects to resolve and settle more than 90% of residential claims by June 2015.
Jimmy Higgins, Vero’s executive general manager, earthquake programme, said: “Our multi-unit properties programme is well advanced. We started building the first two major multi-unit residential properties in central Christchurch in October and have a number of large multi-unit properties close to contract stage.”
He said their commercial reinstatement programme had begun to wind down with 90% of their total commercial claims expected to be paid out by June 2015.
IAG:
The company, in this instance meaning all the IAG brands except
Lumley, has over 78% of claims either settled or in reinstatement, as of 1 December.
‘In reinstatement’ means both the repair or rebuild is agreed and the customer is underway within the programme or work, or has reached agreement and is moving ahead with a cash settlement.
Over 3,000 IAG customers have opted to cash settle their over cap claim, the company says, and through IAG’s reinstatement programme, nearly 950 new homes and major repairs have been completed, along with close to 17,000 out of scope claims.
IAG says its commercial claims are 86% complete.
The Lumley programme has advanced to 89% of claims settled or currently in reinstatement.
IAG said while it had set the target of this month to settle all earthquake claims, in the two years since that target was made it had continued to receive numerous over cap claims from
EQC each month.
The revised settlement target was now mid-June 2016.
Dean MacGregor, EGM, IAG, said: “We are acutely aware that some customers have been waiting a long time to settle their earthquake claim, particularly those who have more recently come over cap.
“While we have reinstated a large number of our customers’ homes we also acknowledge that for some, this process has taken much longer than we ever anticipated.
“We want our customers to be able to move forward with their claim and their lives and we will be working with each of them over the next few months to identify how we can reach resolution for them.”
Tower:
Tower says it has 89.9% of all Christchurch claims settled and 94% settled and resolved as of 30 November 2014.
Tower says settled means the repair or rebuild has been completed and the customer is back in their house, or they have cash settled; while resolved means the building is in construction or a contract has been signed with the customer or builder.
David Ashe, manager earthquake recovery at Tower, said the multi-unit claims were an issue still.
“I think all the insurers are working very, very well together to try and resolve that one. We’ve seen some good progress but they are taking longer than most people anticipated.
“There are some very unique scenarios that no one would have ever contemplated before. For instance, one we’re looking at is a block of six, the first three are under cap, the fourth one is uninsured, we insure the fifth one and there’s another insurer with the sixth one.”
Ashe said by the end of next year they hope to be 95% closed and settled, after which time there would be a small tail of complex claims and multi-unit repairs and rebuilds remaining.
FMG:
The rural insurer says it has now settled 93% of all Canterbury earthquake claims as of 30 November 2014.
This includes everything from domestic dwelling claims (either over or under cap), commercial and farm buildings, contents, pathways, driveways, fences or claims prompted by temporary accommodation requirements.
FMG’s head of Canterbury earthquake recover, Grant Paul, said settling claims has always been and remains their number one priority.
MAS:
According to MAS’ November progress report there were 300 repair properties registered in their earthquake programme with a number of them only being deemed over-cap by EQC in the last 12 months.
Out of these, 72% were either settled, in procurement or under construction.
There were 126 rebuilds as of the same date with 90% settled, in procurement or under construction.
ACS Claims Services (Ansvar):
A spokesman said the company was making good progress finalising customer claims but being a small insurer in run off, it did not wish to disclose its statistics other than when reporting to CERA and ICNZ in respect of progress.
Earlier this month ACS Claims told CTV in Canterbury that they had 2,800 claims and had settled 94% of all customers’ claims and completed about 75% over cap claims.
Southern Response:
Based on detailed information on their website, the government-owned claims management company is dealing with 7,257 over cap claims. As of 30 November, 54% were fully settled, including 739 completed rebuilds and repairs.
Southern Response has 3,049 (42% of total over cap claims) customers who elected to have the company manage their rebuild or repair. At the end of November, 91% were either completed, under construction or in documentation/design phases.
Out of 21,600 out of scope claims, 17,573 were fully settled with 3,131 still in progress and 896 still to be assessed.
