Introducing new concepts such as the earlier inspections being "only a preliminary assessment" (Press article here), IAG is creating a smoke screen. The words are aimed at portraying IAG in as good a light as possible to a much wider public, showing how they are operating within a government sanctioned framework, and creating a climate that is supportive of the company and dismissive of claimants.
Not stated in the media releases is what appears to be another new concept: that IAG can use the Department of Building and Housing's guidelines to opt out of their insurance contract with policy holders.
IAG are creating the impression that, if they can repair a house, that is all they have to do. A sort of - if you can live in then thats all you need - approach. However the main principle behind most policies has been a like-for-like basis, or something similar, that restores the property owner to the situation they were in before the earthquakes.
Ultimately the issue will come down whether the insurance company is meeting its policy obligations, not the content of the Department of Building and Housing's guidelines.
Interestingly IAG seems to be a company with form. When the Queensland Government held an inquiry into the conduct of insurance companies after the Queensland floods CGU, a part of the IAG, was singled out for special mention. The following is from an earlier blog about the Queensland floods inquiry (here):
As an aside, one of the worst performing insurance companies was CGU, part of IAG (Insurance Australia Group) - see Chapter 12, e.g. pages 287, 288, 308, 310. As well as property insurance CGU is a player in the provision of workers compensation in Australia. IAG NZ (a wholly owned subsidiary of IAG Australia) has links to New Zealand through State Insurance, NZI, Lantern Insurance, and the non-earthquake side of AMI. Names to watch for the future?There have been a few blog entries on insurance companies in recent months so, click on the entry name if you want some background: