"Highlighting the inadequacies of the way in which the earthquakes of 2010-2012 were handled by the insurance industry! "

The Problems Cantabrians Are Facing with Insurance


Owning a home and feeling secure in it is a cornerstone of our sense of financial security and personal confidence. This aspect of life was lost to thousands of New Zealanders in the earthquakes and now that loss is being compounded massively by the widespread difficulties in resolving claims and problems associated with shoddy repairs. Shame on the Earthquake Commission, the private insurance industry and the Government for not coming to the aid of its citizens.  The list of ‘failures to deliver’ is a long one:

  • Failure to properly investigate claims by both EQC, Southern Response and the private insurance industry resulting in shoddy repairs;
  • Access to justice and the cost of justice;
  • Apparent government indifference to the plight of Cantabrians, particularly the elderly;
  • Lack of transparency by agencies involved with recovery – Council, EQC, Government, CERA and the private insurance industry;
  • Insurers lack of willingness to progress claims contributing to slow progress of recovery;
  • Changes to assessment standards and the use of Ministry of Business, Innovation and Employment Minimum guidelines to diminish settlements with homeowners;
  • Requirement to continue to pay insurance premiums on uninhabitable homes;
  • No legislated time frame for resolution of claims;
  • No policyholder protection- either in the form of cheap justice or an independent ombudsman;
  • Legal class actions appear deliberately difficult to establish;
  • Insistence by EQC and private insurers on cash settlements despite insurance policy terms promising reinstatement which reduces policyholders’ claims and results in low offers;
  • Questionable performance and vested interests of other professionals involved in assessments e.g. engineers and loss adjustors and lawyers acting for insurers;
  • Apportionment issues between EQC and private insurers;
  • Lack of good faith in dealings with people ;
  • Insurance dealings with clients heavily slanted and blatant distrust toward claimants is usually exhibited – which creates a vicious circle and adversarial atmosphere of distrust contributing to the stalling of the process;
  • Lack of access to accurate information about progress in the City and the number of claims that have been progressed by insurers;
  • Reducing payments for depreciation;
  • Unreasonable interpretation of policy terms/ surprise ‘conditions’ introduced.

**Outcomes residents need now:

  • Fair and transparent resolution of claims so that people can restore their lives.
  • Maintenance of public confidence amongst decision making bodies rather than the political turf wars and overlapping efforts we witness;
  • A commission of inquiry into failed repairs and MBIE policy decisions including an investigation into the continual changes in the standards to the building code which has meant that the City is left with thousands of sub-standard ‘repaired’ buildings;
  • Public access to all geotechnical information;
  • Lack of affordable accommodation for those waiting settlement of their claim and access to affordable building sites for those wanting to rebuild;
  • Access to personal information held by EQC and private insurers without having to go through the Official Information Act – we need these organizations to stop acting like the secret police!;
  • A proper triage system implemented so the most vulnerable in our society can be helped first and can move on with their lives;
  • Some honesty and true oversight from the Institution of Professional Engineers NZ;
  • The introduction of exemplary/punitive damages in our courts for poor performance by insurers;  Only NZ does not do this in the OECD  – Why??;
  • Legislated fixed time frame for the settlement of claims so that insurers cannot leave people in limbo;
  • The Government – Gerry Brownlee, that is,  needs to sort out the private insurance industry – remind them that if they are not up to the job there are plenty of other insurers around the world who would be happy to fill their shoes;
  • Every insurer should have to provide the following on a quarterly basis: 

Total Number of Claims

1.    Number of Claims Closed with Payment

2.    Number of Claims Closed without Payment

3.    Average time in days from date of claim report to date of inspection

4.    Average time in days from date of inspection to date of estimate

5.    Average time in days from date of estimate to date of claim payment

6.    Total number of adjusters working in field on losses related to Christchurch Earthquakes

7.    Number of Complaints

8.     Number of complaints as percentage of number of claims

Outcomes that New Zealand needs Going Forward:

  • It’s time for us to begin to talk seriously about the introduction of a new insurance system  – a public insurer – KiwiSure,  where the people of New Zealand look after their own interests and the private insurance industry covers only contents, health and auto insurance.   Residential and commercial property would become the preserve of a public insurer. See Chapter 7 of The Insurance Aftershock: The Christchurch Fiasco Post Earthquake 2010-2016.KiwiSure

Done properly (not like the current EQC’s performance) this could work brilliantly for the people;

  • A major restructuring of EQC so that it provides the protection New Zealand citizens require;
  • Policyholder protection in the form of a permanent mediation system and an independent insurance commissioner;
  • Public access to a country wide database which details all information relating to geotechnical information so Cantabrians can make wiser choices about where to live and build;
  • Affordable access to the Courts – justice for all, not simply the wealthy;
  • Introduction of exemplary/punitive damages for insurers;
  • Legislated protection in the Building Act which prohibits the watering down of consumer rights during post disaster rebuilds for the financial advantage of corporates and EQC;
  • While private insurance industry is operating there must be sound prudential management of the insurance industry: changes to the way in which insurance companies are regulated so that capital adequacy requirements are more stringent so as to avoid failure of insurers during catastrophes;
  • The introduction of the American concept of ‘bad faith’ on the part of the insurer as an actionable breach of contract;
  • Speedy passing of the Class Action Bill which has been in limbo since 2009;
  • Public education programs about insurance, its implications and what is required to protect yourself adequately – e.g. education about fixed sum insurance;
  • Debate and Referendum on how we will insure ourselves in the future in New Zealand in light of the ever increasing number of climatic events – public vs private.  The issue is too big to ignore.

We are  a seismic nation and we need to better prepare ourselves for the future! Cantabrians want answers! If the rest of New Zealand had any sense they’d also  be calling for these answers – because if they don’t – you can guarantee that it will be their Fiasco next time round!


~Future Proofing for a sustainable, participatory, democratic society.

Author: Sarah-Alice Miles

Love to write, create and watch the clouds move across the sky - these days in the Netherlands. 'Art allows us to find ourselves and lose ourselves at the same time'.

4 thoughts on “The Problems Cantabrians Are Facing with Insurance

  1. Please do not give up your investigations. Most people I know are just waiting or just are getting nowhere. Thank you for showing some leadership and commonsense. I have your book and now read your illuminating blog. Thank you again.


  2. I was referred to your blog through a friend on Facebook. Your suggested solutions are excellent. Every New Zealander has a stake in this, but we are far too complacent. I’m not a lobbyist or activist or have any idea how your suggestions can be progressed, but I think it’s important that they are. If anyone knows how to progress them I’d be happy to help.
    Thanks for providing some solutions as well as pointing out the problems.


  3. Hi Sarah I’m always so pleased to read your blog. We live in a derelict house waiting for State to do the right thing , my son owns a house in Carrick street . it has serious damage apparently Fletchers were going to repair it. Yesterday it was flooded. it’s. a new claim with Tower. Tried to talk to Fletchers about the flooding and the plight of the poor tenants . Was then informed that it is no longer on Fletchers books as it is now in a flood area. EQC also said they would do nothing. Had to tell the tenants they would have to move right away. Of course the mortgage still has to be paid ditto the rates. My son is in England right now so am trying to cope. Do you know anymore about this catch 22situation. Cheers tina Reynolds


  4. Well written Sarah.. In a nutshell, the treatment Cantabrians are having to endless endure is nothing but a show of shameful disregard from the Governing bodies of this country in their ongoing avoidance of responsibility to their citizens, allowing unqualified / an unsurpassed breaches of contractual law causing undue hardship & illness to innocent victims. .


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