Policies aim to break Chch insurance deadlock
Westpac bank is teaming up with Lumley Insurance to offer insurance policies for new Canterbury construction projects and full replacement home and contents policies.
The bank said the new policies would break Christchurch's insurance deadlock.
Following the large earthquakes of 2011 many insurers said they did not want to take on extra risk or new policies. However, Vero recently said it was widening its risk appetite and would open to insuring more buildings than it had.
Westpac, in a statement, said the lack of available insurance has left hundreds in limbo and unable to get on with rebuilding their lives after the earthquakes.
To overcome that, Westpac and partner, Lumley Insurance, has secured international reinsurance backing.
Westpac managing director of private, wealth and insurance, Simon Power, said customer feedback was the driver in persevering to put the Canterbury new building cover together.
Westpac hoped, by being the first major financial institution in New Zealand to do so, it would help open up the market.
"We have listened to the frustration and anguish many of our customers have experienced through the lack of available insurance to build a new home and have been determined to find a practical solution," Power said.
"Now, not only do we hope this helps people move on but it also goes some way to opening up the market.
The bank had formed a "Canterbury New Build Pac" package combining a Westpac home loan, a transactional account and contract works and home cover for new and existing Westpac customers who are ready to start on residential builds or purchase new residential builds in Canterbury.
Contract works cover, which is included in the package, was for a maximum period of 12 months and includes protection from natural disasters and earthquakes.
Home cover would be on a "sum insured" basis meaning customers insure for full replacement, up to the specified value.
"Sum insured is common overseas and is expected to become the norm here after the earthquakes changed the country's risk profile in the reinsurance market," Westpac said.
- © Fairfax NZ News