November 2016 Claims

Questions to ask your insurer has received many enquiries from homeowners effected by the November 2016 earthquakes. Below we have compiled a list of questions presented to the Insurance Council of New Zealand (ICNZ) CEO Tim Grafton and representatives of EQC. If any of these questions are relevant to your claim, you should get answers from your insurer and/or your legal advisors before you consider settling with your insurer or EQC.

Some questions have been edited for clarity and context.

  1. Has my insurer and EQC set up a system to prioritise the claims of those most in need – how do we tell them about these cases?
  2. Are all claims going to be paid rather than the insurer and EQC arranging the repairs?
  3. Schedule 3 Section 9 of the EQC Act 1993 states “The Commission may at its option replace or reinstate any property that suffers natural disaster damage, or any part thereof, instead of paying the amount of the damage, but the Commission shall not be bound to replace or reinstate exactly or completely, but only as circumstances permit and in a reasonably sufficient manner.
    EQC has used the “reasonably sufficient manner” caveat as a way to reduce its reinstatement standard in Canterbury since 2010 (down from “When New” elsewhere in the EQC Act). Please can you confirm that the “reasonably sufficient” excuse is not available to EQC (or Private Insurers as agents of EQC) when they elects to settle by cash payment?
  4. What written information has EQC provided to Private Insurers acting as their agents on the standard of reinstatement required under the Act?
  5. Can you explain what the terms “cash settlement”, “full and final”, and “discharge of claim”? 
  6. Can you offer an opinion as to what I should do if I am presented with documents which are "full and final"?
  7. Is a home owner required to accept an insurer's payment in full and final settlement of their claim?  If not, and they do not accept the amount offered, what will the insurer do?
  8. What happened to my insurance cover and premiums once I have been paid a full and final settlement?
  9. If the money is paid off my mortgage with a settlement, will my bank let me use that money to do the repairs?
  10. Who will be doing the damage assessments and what are their qualifications, and what identification will they produce to the homeowner?
  11. Have the assessors been trained in the appropriate standard of repair to be achieved under the EQC Act and the insurance Policy?
  12. Do assessors understand and accept that the EQC standard includes the items addressed in the Joint Statement between EQC and the Action Group?
  13. Will insurers and EQC be issuing some guidance for homeowners on the standard of repair?
  14. Will assessors be going under timber floor houses to assess the damage to the sub floor – piles and foundations?  If not, how is that damage going to be assessed?
  15. Will assessors be going into roof spaces to assess the damage? If not, how is that damage going to be assessed?
  16. Who decides when they structural engineering advice is required?
  17. Who will be measuring foundation and floor dislevelment and wall out if verticality and will they be complying with the NZ Institute of Surveyors Best practice?
  18. Who will be estimating the cost of repair and what are their qualifications?
  19. How are insurers and EQC accounting for the inevitable cost increases that will come with shortage of contractors and materials?
  20. How are home owners expected to get the repairs done given the shortage of skilled contractors in Kaikoura and other areas?
  21. What is the best way to communicate with my insurer?
  22. What information on my claim can I expect my insurer to provide to me and when?
  23. What do I do if I think that the damage has not been assessed properly or the cost estimate is too low?
  24. Where can I get independent building and legal advice?
  25. What should I do if I don't think the costings will not be enough to fix the damage?
  26. After EQC makes a payment to an insured, how many years does an insured have available to them to reopen an EQC claim and ask for more payment?
  27. How does accommodation insurance work?
  28. What is your definition of an excessive delay, and what should I do if there is excessive delay?
  29. If my home is repaired by the insurer or cash settled and repaired by the homeowner to the standards set out in my insurance policy and the EQC Act applicable at that time, will insurers and EQC waive any claim of pre-existing damage as relates to the November 2016 claim in any future event? In other words, will the insurer and/or EQC accept once the claim is settled it has no grounds to claim there is pre-existing damage from the November 2016 earthquake in any future insurance claim?