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



LaneThe High Court has given the go-ahead for EQC to settle land claims for increased flood vulnerability.  The Court stated that the amount of compensation should be the cost of remediation or the amount of loss of value to the land (depending on the circumstances of the case).

We expect, on the basis of the Court’s decision that the process from here will be as follows:

  1. EQC will further develop and publish itsguideslines for the settlement of flood vulnerability land claims. It will use these guidelines as a starting point for determining which properties are flood vulnerable.  In assessing whether a property is flood vulnerableEQC will reply on:
    1. LiDAR data;
    2. Engineering advice;
    3. Flood modelling;
    4. Flooding history.
    5. If your land is considered by EQC to be possibly flood vulnerable, you will receive notification from EQC of its determination and EQC may wish to inspect your property. If you consider that your property may be flood vulnerable and you have not been contacted by EQC, you should make contact yourself and make sure that your property is considered in this analysis. EQC will then undertake an assessment of flood vulnerability.
    6. If your property is subject to increased flooding vulnerability EQC will assess the damage to your land and consider whether it can be repaired, and if so, how (for example by filling the land, or by lifting your house).
    7. Throughout this process, you can provide EQC with further information or with your interpretation of the existing information. We recommend that you provide EQC with any records that you have of the flooding to your property and any evidence you have that your land has subsided, such as photos, geotechnical advice, reports and/or correspondence with your insurer / City Council / EQC.  You can also obtain your own reports on the damage and remedial options and present these to EQC.
    8. It is important that you ensure that the degree to which you are flood vulnerable is properly captured and that the sometimes quite unreliable LiDAR data that EQC will be relying on is not the sole basis of measurement. In particular if there is recent survey evidence in respect of your property it is likely that this will be considerably more reliable than LiDAR evidence.
    9. If EQC incorrectly determines that your property is not vulnerable to flooding, you can present the above evidence to challenge that determination.
    10. The next step for EQC will be to advise how it proposes to settle your claim. The starting point will be repair or reinstatement of the land.  If you intend to repair the land (including lifting your house or taking other steps to protect them from flooding), then you should make sure this is clearly stated to EQC.
    11. EQC may decide to settle your claim by a payment for loss of value to your land, instead of reinstatement, where:

(a)             You have no intention of carrying out the repair work or reinstatement work; or

(b)             Reinstatement of the land is not practically possible or would not get a consent; or

(c)             The cost of reinstatement or repair is disproportionately expensive; or

(d)             The land has been sold without the repair work having been carried out.

  1. If you are offered remediation costs for your land, it is important to ensure that the settlement sum offered by EQC is sufficient to remediate your land. You can challenge the sum offered by EQC by obtaining independent advice/quotes in the same way you would challenge repair costs to your dwelling. It may also be possible to remediate the land and seek any shortfall later, although there are obvious risks in this approach.
  2. If you are offered diminution of value by way of settlement, we recommend that:
  • If you intend to repair the land, you push EQC to pay for the cost of the remediation instead of diminution in value (unless of course the diminution of value figure is higher). If EQC has incorrectly determined that the land cannot be repaired or that repair is disproportionately expensive, you can challenge this decision on the basis of independent advice/quotes.

(b)             If repair is not feasible, or if you have no intention to repair, you will need to ensure that a diminution in value payment is a fair reflection of the actual loss of value.  The diminution in value calculation will be based on the loss in market value of your land as a result of the increased flood vulnerability caused by the earthquakes. EQC has engaged valuers to make this assessment.  You can challenge the figure by engaging your own valuer to undertake the same exercise.  EQC should also provide a mechanism to allow homeowners to challenge the diminution of value figure attributed to their homes.

  • If you have undertaken the above steps, and you are still not happy with the outcome of your land
  • claim, you can take the matter to Court by way of judicial review or private law cause of action.
  • The Court held that any guidelines developed and applied by EQC must:
  • (a) Be applied in good faith by EQC;
  • (b) Not be applied mechanically and be open to other factors;
  • Not exclude relevant factors;
  • Entitle owners to provide further information, or an alternative exploitation of existing information; and
  • Not prevent owners challenging EQC’s decision in Court.
  • If EQC breaches these requirements or any other principles of natural justice, you can challenge
  • the process undertaken by EQC in accordance with judicial review.
  • Alternatively, EQC can be sued like an ordinary insurer. That means that they must act as if the
  • EQC Act were an insurance policy and it must be followed strictly. EQC must not only act
  • reasonably, it must act correctly and in accordance with the obligations set out in the Act. If it fails
  • to, you can bring proceedings against EQC for breach of its statutory obligations.
  • Please do not hesitate to contact us to discuss any of the above further with you or provide you
  • with additional advice.
Duncan Webb / Sophie GoodwinPartner / Associate

Lane Neave Lawyers



Tel: +64 3 379 3720

Fax:+64 3 379 8370 

  • Disclaimer: The content of this article is general in nature and not intended as a substitute for
  • specific professional advice on any matter and should not be relied upon for that purpose.

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'.


  1. CCC has already devalued the land our house sits on by $16.000 in it’s latest rates valuation from that of the previous valuations. Surely EQC would simply top up the $16.000 plus appreciation the land would have valued by if there had been no earthquakes.


  2. I recall a report out in the news not long ago about New Zealand’s position on the corruption ladder , totally wrong & incorrect , perhaps Sarah could post it for all to see & allow those seriously effected by the injustices of the Governments EQC Department ( how dare they waste $5 million fighting to deny us our legal right to our insurance settlement , from the earthquake damage ) everyone effected should write to this body & have our position reassessed for the world to see the real deal & what we are putting up with , 3rd world conditions in a western democratic society .


  3. I’m starting to think Sir Bob Jones might have something when he said turn CHCH into a giant lake or are we going to wait for another big earthquake & sink more metres below sea level. Come on EQC , pay people out so the have the choice to leave the sinking ship.


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