Insurance Settlements Pour Millions into Canterbury

19 September 2011

Insurance Cash Settlements Pour Hundreds of Millions into Canterbury Economy

Hundreds of millions of dollars are now being paid to Christchurch businesses and property owners settling claims for their earthquake damaged properties, with insurance payouts now estimated at a billion dollars, the Insurance Council says.

Insurance Council Chief Executive, Chris Ryan, today confirmed that many Cantabrians are receiving or asking for cash for claims for earthquake damaged central city properties and business insurance claims since the devastating September 2010 and February 2011 earthquakes.

What we are now seeing is the result of solid progress between insurers and claimants settling their insurance claims early with their insurer so that they can move on with their lives, Chris Ryan said.

Not surprisingly, where insurance claims are straightforward, insurers will cash settle with the claimant quickly to ensure that businesses are able to get back to trading, or to allow the payouts to be invested in a positive future, including keeping businesses operating and staff in jobs, Chris Ryan said.

Chris Ryan said he was aware that the money from some insurance cash settlements was being used to purchase investment property in other centres but he said that insurers took the view that it was up to individual businesses how they used the proceeds from insurance settlements.

“In terms of the recovery of Canterbury, the main focus of the insurance industry is to settle claims for earthquake damage as quickly and as efficiently as possible to allow claimants the ability to rebuild their lives and their businesses and to ensure that they have choices with a future, hopefully for the benefit of all Cantabrians.”

Chris Ryan reminded Cantabrians insurance is available for almost all Cantabrians for earthquake cover.

“The difficulties arise for some people who are moving into the region and wishing to take up insurance. Solutions are available for those people. Insurers are agreeing to insure people on properties that are already insured, but may require some data about the condition of the land under those properties.”

“The problem for insurers is the continuing after-shocks in the Canterbury region. Insurers are concerned that the after-shocks, even relatively minor ones, are doing continued damage to properties on already liquefacted land.”

Chris Ryan said cash settlements to date from private insurers estimated at a billion dollars are the forerunner of what is expected to a $15 billion dollar private insurance windfall for the Canterbury economy by the time the Christchurch rebuild programme is completed.

ENDS

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