Insurance Council supports new meth standard

30 June 2017
Insurance Council supports new meth standard

The Insurance Council of New Zealand supports the new standard for methamphetamine contamination, sampling and testing announced recently by the government.

“There are numerous conflicting messages about meth contamination and insurers have seen increasing numbers of claims from property owners who are faced with levels of contamination from tenants passively smoking P right through to contamination from meth labs” said Insurance Council Operations Manager Terry Jordan.

The science relating to the health effects of meth contamination isn’t clear and internationally, there is a wide range of measures and different standards, defining when a property is safe to re-occupy following meth contamination.

“On balance, insurers support the increase from 0.5µ/100cm2 to 1.5µ/100cm2 which better reflects the current scientific understanding of the health risks of methamphetamine” he said.

“With the requirement in the new standard for sampling and remediation companies to be independent from each other, the Insurance Council believes there will be less room in the market for the “cowboy” clean up companies that prey on the fears of tenants and landlords.

The objective of the standard is to identify methods of testing properties that provide reliable results and identifies decontamination and remediation processes that are effective and enables properties to be safely reoccupied in a cost-effective manner.

Claims for meth contaminated properties have been steadily rising in recent years and are now estimated to cost insurers in excess of $30 million per year or 100 properties per month.

Insurers coverage of losses from methamphetamine contaminated properties ranges from exclusion, to increased excesses, to coverage but with sub-limits, to full cover but with requirements for checking tenants and undertaking regular property inspections. Some insurers are reviewing their policy wording to clarify contamination levels that relate to losses.

Property owners need to be made aware of the requirement to disclose methamphetamine contamination in the properties to their insurer.

ENDS

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