News Non-Life02 Aug 2018

New Zealand:Move made to form tribunal to resolve Canterbury quake insurance disputes

| 02 Aug 2018

Cantabrians are a step closer to getting a special insurance tribunal to resolve outstanding Earthquake Commission (EQC) and insurance claims.

A Bill, to establish legislation for a tribunal to resolve outstanding insurance and EQC claims, was introduced in Parliament on 1 August.

In the Budget delivered in May, the government announced NZ$6.5m ($4.4m) in operating funds and NZ$1.5m capital to establish an independent tribunal to resolve disputes arising from the Canterbury earthquakes of 2010 and 2011. There are around 3,600 outstanding Canterbury earthquake claims.

Justice Minister Andrew Little said the legislation would give claimants access to an individually case-managed resolution process as well as mediation services.

Ms Megan Woods, the minister responsible for EQC, said, "This tribunal will be one important way to help cut through the delays and get claims resolved so people can move on with their lives. This is very exciting legislation that will help make a real difference for people."

Insurers' response

The Insurance Council of New Zealand (ICNZ) has welcomed the move to establish the Canterbury Earthquakes Tribunal because it hopes this will accelerate claim settlements.

In a statement, ICNZ says that it is also disappointed with several points from the government's announcement about the Bill.

"First, that the tribunal won’t be up and running until 2019, the best part of 18 months since the government was elected," said ICNZ chief executive, Tim Grafton. “It will have been nearly nine years since the first quakes, far too long by anyone’s measure to be finally trying to sort this out. Insurers want to settle their customers’ claims as quickly as possible but we’re still receiving, on average, two claims a day from EQC."

"Second, we have concerns with the way the tribunal is proposed to be run. It will not allow insurers to bring cases, only policyholders. This is unfair as it only deals with one half of the problem and the Ministry of Justice agrees, saying it creates inequity of access to justice."

"Third, that the Minister and the Ministry have failed to engage with key stakeholders on this issue. While the government’s own agencies, EQC and Southern Response, account for the majority of outstanding claims, neither they nor private insurers were consulted on this Bill before its introduction. We were given an undertaking that would happen and that has not been followed through on. We have sought repeatedly to engage with the Minister on this process but according to his own advice he and the Ministry have spoken only to Treasury."

"Finally, we are keen to be certain that the tribunal will respect the rules of natural justice and fair procedure, the need to apply the rules of evidence, to be bound by precedent, and the ability to appeal significant points of law. Any Bill that does not respect these legal principles will not be supported by the insurance sector."


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