Ombudsman steps up involvement as queries surge

22:41, Sep 17 2011

The insurance Ombudsman's Office is stepping up its involvement in post-quake insurance issues as queries about insurance practices escalate.

"Inquiry levels are certainly picking up. At last count we were just over 250," said Iain Opray, who is heading the new earthquake response team set up by the Ombudsman's Office.

Many of the inquiries relate to perceived delays in getting insurance payouts but Opray said it appeared things were "starting to move" and offers were now being made by insurers.

Last weekend up to 300 people from Christchurch's residential red zone protested in the streets over the government's payout offer and the refusal by some insurance companies to pay the full replacement value on their homes.

The insurance companies are arguing their homes are not damaged beyond repair, even though the land on which the homes sit has been condemned.

Opray said he would be meeting with insurers to find out exactly how they were addressing many of the vexed issues raised.

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"This is to enable us to advise consumers in an informed manner and, hopefully, prevent many issues becoming complaints. Unfortunately, when complaints relate to delays, we are unable to assist, as we cannot influence this process or the prioritisation of work," Opray said.

The government was also keeping a close eye on the insurance industry. "If insurance companies aren't doing their job properly, that's something of concern and something the government is monitoring," Prime Minister John Key said last week. "Insurance companies should meet their obligations."

Insurance Council spokesman Brett Solander said the insurance industry was committed to honouring its obligations and had stepped up to the plate since the first quake hit on September 4. It had already paid out around $1 billion in claims and was anticipating a total insurance payout of around $15b.

"The aim is to settle claims as quickly as possible," Solander said. "The people of Canterbury don't want a future that is blighted by delays and neither do we. There is no point in delaying claims because if you delay claims, the costs increase." He said the industry was working closely with the government and banks to find solutions for those hardest hit and was hopeful of resolving the grievances that have been raised.

"There is a lot of good stuff happening in Christchurch in terms of the insurance sector ... this industry is totally committed to Canterbury's rebuild, it's fully supporting Christchurch and is behind the region. We're determined to make sure Christchurch recovers and flourishes again."

Sunday Star Times