Fewer fighting insurance firms

17:00, May 28 2013

Aggrieved Cantabrians are fighting their insurance companies in earthquake disputes, but not in the numbers expected.

The Insurance & Savings Ombudsman (ISO) Scheme provides a free, independent service for those deadlocked with insurers.

The scheme has dealt with more than 1000 quake-related inquiries, but received just 65 formal complaints.

Earthquake response manager Iain Opray, who was in Christchurch this week, told The Press more awareness of the service was needed.

"Even this long after the earthquakes, people are saying, ‘We didn't know about you' or ‘We didn't know the process for actually getting to you'."

People needed to be "pointed in the right direction", he said.


ISO worked to avoid formal complaints being lodged, he said, and could not "just jump in" and take over management of a claim, Opray said.

A complaint could only be raised once an insurer's internal disputes resolution process failed.

The amount disputed could not exceed $200,000, but that did not include Earthquake Commission (EQC) settlements.

Findings were binding on insurers, but did not prevent customers taking legal action.

Although insurance delays had prevented the recovery from gathering pace, "things are moving", Opray said.

"Insurance policies are being tested in ways like never before."

The Insurance Council of New Zealand yesterday said insurers had paid out $7.3 billion in claims.

Chief executive Tim Grafton said this included settlements of more $500 million in the past three months, $300m of which was allocated to residential claims.

"Residential claims settlements are running at over $3m a day on average," he said.

Figures showed that of the 173,000 residential properties with either an EQC or private insurance claim, 23,000 were confirmed as insurers' responsibility as they exceeded the commission's liability.

About 6200 of the insurance cases had been resolved and 2600 were in the design or construction phase.

The remaining 14,000 comprised mainly those still to decide on an offer, those living in multi-unit and cross-lease properties, or in severely damaged land areas.

The Press