Showing posts from 2015

Survey of former residential red zone owners who accepted Crown offers

CERA is currently surveying all who were Red Zoned and accepted the  Government’s (Crown)  offer.  Research company Neilsen are conducting the survey and invitations to take part started going out via e-mail on the 14th (last week). If you were Red Zoned, and took the offer, you should have received a survey invitation by now. If not it is likely to be the result of a change of e-mail address since the Crown offer process started. Whatever the reason, you can participate by ringing Neilsen on  0800 400 402. If you are cautious about taking part in case it resurrects stresses and demons best left buried, Neilsen offer the following advice in the first part of the survey: We hope that you will find the survey experience positive, but we understand that many former property owners may find the issues it covers difficult and taking part may bring back mixed emotions. If you find this to be the case we encourage you to consider calling the Canterbury Support Line on 0800 777 846 or to c…

THX 4 THE MEMORIES - Avonside photographic exhibition now online.

The 22nd of August 2013 was the official opening of the Avonside photography project Thx 4 the Memories exhibited along Worcester Street. It consisted of photographs of Avonside people by Bridgit Anderson and Tim Veling along with snippets of their Red Zone experiences as recorded by Glen Busch (original post here).Tim has put together an online book that recreates the exhibition and you can find it by clicking on the first link below. Eventually, once numerous obstacles are overcome, there will be a print version available.Tim has a dedication and endurance second to none and continues to record what is happening where we once lived and how it will all eventually turn out. Tim has done other projects as well and the second link takes you to the projects part of his website.Thx 4 the Memories
then click on the book cover just below the video.
All Tim's projects

More support for legislative changes covering insurance non-disclosure

The Insurance Business New Zealand website reprorts that dispute resolution service Financial Services Complaints Ltd (FSCL) supports the Insurance and Savings Ombudsman’s view legislation is needed to deal with non-disclosure and insurance claims. The article is here. The following are extracts from the article:“We are a step behind overseas jurisdictions like Australia and the UK.“I think the government should be taking a closer look because the current law is very old. There have been, I think, two Law Commission reports saying it’s time for the law to be looked at.”.

Residential Red Zone offer feedback sought

CERA is seeking feedback on their Preliminary Draft Residential Red Zone Offer Recovery Plan. Comments must be submitted by 5.00pm on the 19th of May.The Draft plan starts off by explaining the “why?”.The purpose of developing the ‘Residential Red Zone Offer Recovery Plan’ is to assist the Crown (through the Chief Executive of the Canterbury Earthquake Recovery Authority (“CERA”)) to determine whether it should make new offers to buy vacant, commercial and uninsured properties in the residential red zone and, if so, how such offers should be structured.However, before the plan there has to be a draft plan.This is the Preliminary Draft Recovery Plan, notified for public consultation on 5 May 2015. This Preliminary Draft is the first opportunity for everyone to provide their views. You do not have to be an affected property owner or live in greater Christchurch to have a say. This public consultation is an important first step. The Preliminary Draft is in essence a discussion document, …

Legal class action against Southern Response?

Wednesday’s Press has an article Southern Response class action ‘no win, no fee’here. The proposal, offered by law firm GCA lawyers, is for “disgruntled customers of a major earthquake claims-holder to join "no win, no fee"class action lawsuit.”Sounds too good to be true (and potentially is). Click on the link to continue.

Insurance Ombudsman wants insurance legislation to cover non-disclosure of information

The Insurance Business New Zealand website is reporting that the Insurance and Savings Ombudsman Karen Stevens supports legislation to better protect customers relating to information they disclose to an insurer. The following are extracts from the article (the full article is here).Karen Stevens says legislation would mean an insurer could only avoid a policy where it could show the non-disclosure was deliberate.Some cases are clear, where people deliberately leave out information they were asked to provide, knowing that it will go against them. However, in other cases, people accidentally leave out information because they have forgotten, or do not realise it is important.”The current law requires a consumer to disclose to an insurer all information a ‘prudent underwriter’ would consider important. But, said Stevens: “This is extremely difficult for consumers to understand.“My concern is that consumers don’t understand the consequences of not providing the information.However, she s…

A plan followed by consultation for the outstanding red zone Crown offers

Earthquake Recovery Minister Gerry Brownlee has decided that everyone can have a say on what level of pay-out should be provided to those in the Red Zones who have been ineligible so far (uninsured owners of land and property).It is hard to tell whether the Minister has suddenly been overcome by a desire to indulge in participatory decision making or it is a device to allow public participation to be used as a shield for yet more delays followed by the same decision as before.The news release is reproduced in full below. The original is available on the Beehive website here.Release Date: 21 April 2015Canterbury Earthquake Recovery Minister Gerry Brownlee has announced a process to give everyone a say on the Crown offers to owners of vacant, commercial/industrial and uninsured properties in the Residential Red Zone."I have asked the chief executive of the Canterbury Earthquake Recovery Authority (CERA) to prepare a Recovery Plan that looks at the offers to property owners in these…

Help with making an Official Information Act (OIA) request

The New Zealand Herald is helping to re-establish a website designed to make requesting official information as easy as possible. From the Herald’s website:The Herald is helping relaunch - a website which helps members of the public to make Official Information Act (OIA) requests.Rowan Crawford, a software developer, set up the FYI website after a 2009 Open Government event as the first version of this tool outside of the United Kingdom. Users of the FYI website can make requests and receive replies from various government agencies directly through the website.The rest of the Herald article is here. Apart from helping individuals with the OIA process, the website publishes all requests and answers so anyone can follow what is happening on a particular topic or with an agency or department.  From a privacy perspective, if you want your request to be personal to you and whoever has the information, this website isn’t for you.  As the FYI website says on the form used to make…

Fair Insurance Code 2016– where to now?

The revised Fair Insurance Code has yet to be ratified. It is to be considered at the ICNZ AGM some time this month and “there may be minor adjustments” to the Code. One wonders what “minor” might allow by way of changes. Will keep you posted on what is decided. In the meantime there will be a break at the Avonside Blog until early April, unless something interesting arises..

Concerned IAG may cash you out?

Lawyer Duncan Webb from law firm Lane Neave has written an article My insurer wants to cash settle my claim … which covers the issues IAG customers might find themselves facing. The article is here.It is very informative, practical and a worthwhile read even if IAG is not your insurer. IAG customers are likely to feel a bit more at ease for having read it..

Summarising the Revised Fair Insurance Code – Part 3

Insurance policies and the associated code of conduct cannot be seen in isolation from those who buy the policies, and the claims experiences they undergo. So far the Revised Code has been considered without much direct reference to the human experience. These are experiences other New Zealanders can anticipate undergoing, should there be another disaster and the Code remains substantially unchanged. What follows, as well as what has gone before, will seem ill-informed, harsh and graceless to those in the insurer camp. They, in my opinion both here and below, are wrong. Nature can cause devastation but it is humans who layer injustice and cruelty upon disaster - something insurers, amongst others, seem adept at. Of course there are those who point to the unprecedented nature of the Canterbury earthquakes, as if this justifies all shortcomings and bad behaviour. What is not so eagerly highlighted are the precedents and parallel examples of bad insurer behaviour – Hurricane Katrina, H…

Summarising the Revised Fair Insurance Code – Part 2

In this post we will look at whether the Code is fair or transparent, and whether utmost good faith remains relevant to New Zealand insurance practices. Is it a Fair code?No. There is no definition within the Revised Code explaining what fairness is. In the world of dictionaries there are varying definitions, with the Oxford Dictionary giving this: “Impartial and just treatment or behaviour without favouritism or discrimination”.   1     Using this authoritative definition it is quite obvious the Revised Code is not impartial. The Code has been written by insurers, for insurers. The Revised Code has omitted a large portion of what was asked for in submissions to the Review – changes and provisions that would have make the Code less partial towards insurers.   2     The Revised Code continues to require customers to anticipate and comply with sometimes unclear or unknown requirements. It then allows insurers to penalise them for not complying with the requirements. This cannot be co…

Summarising the Revised Fair Insurance Code and its shortcomings – Part 1

The Fair Insurance Code serves two purposes: operational and political. Operationally the Code exists to briefly sketch how insurance processes work, to make customers aware that both insurers and they have rights and obligations, and that failure to fulfil the obligations carries penalties. In practice the Code places wide, strict and complicated obligations upon customers and narrow flexible obligations upon insurers. Politically the Code exists to create the appearance of a fair and robust self-regulating regime. Creating and promoting this appearance is a defence against attempts to regulate the industry and reduce the power and enormous advantages insurers have in their dealings with customers. Criticising the CodeFinding fault with the Revised Code has attracted the criticisms of being ill-informed and not understanding the 300 year old history of one of the cornerstones of the insurance industry: utmost good faith. At a superficial level these criticisms appear to have valid…

Fair Insurance Code Questions & Answers – Part 3

In the previous post, covering FAQ 7, it was stated that an underlying purpose of the Code was to pre-empt any external control on how insurers carried out their business. The point was also made that as far as interpreting insurance policies is concerned, insurers are very strong advocates of the Humpty Dumpty Position: "When I use a word," Humpty Dumpty said, in a rather scornful tone, "it means just what I choose it to mean - neither more nor less."
(Through the Looking Glass – Lewis Carroll )
FAQ 8 is where they excuse themselves from attempting to clarify what is meant by what they say.

Fair Insurance Code Questions & Answers – Part 2

Why is ICNZ so keen on having a Fair Insurance Code, and prickly over criticism directed at the Code? At an operational level the Code is a useful means of providing a standard approach to offering, selling and administering insurance. This has benefits to insurers as they want customers to have a feeling of ease and security in buying and keeping insurance. It works quite well, with New Zealand having an extremely high uptake of insurance which, in turn, means significant revenue for insurance companies. At the political level the Code is one of the means used by insurers as they work to prevent or obstruct legislation to regulate the insurance industry. Unrestrained self-regulation is their on-going goal, and the Code is the part of the public face of how they go about it. Prior to the earthquakes insurers operated without public scrutiny and there seemed to be no shortcomings (unless you dug deep). Should the fairness and suitability of the Code now be successfully challenged th…

A helpful change to the insurance disputes process coming up?

Yesterday Paul Goldsmith, Minister for Commerce and Consumer Affairs, announced  the opening of consultations on changes to the maximum amount that could be taken to the insurance industry’s disputes resolution services (the full media release is below).The change proposed is an  “… increase to the cap on the compensation that dispute resolution schemes can award in relation to disputes about real property insurance claims. The proposed increase is from $200,000 to a minimum of $350,000.”Post-earthquake, only disputes up to $200,000 could be considered by the insurers’ independent dispute resolution services. Beyond that amount disputes had to be taken to the High Court, an action too expensive for most people. Insurers could have agreed to have larger amounts considered, but this did not seem to happen. As a consequence many homeowners were, in effect, coerced by insurers into a take it or leave it situation. At the time there was significant demand for the cap to be raised.The gover…

Kaiapoi Red Zone photographic exhibition

The Kaiapoi Public Library is currently hosting an exhibition of Red Zone photographs by Cosmo Kentish-Barnes.Cosmo  spent a few months around Kaiapoi photographing earthquake damage. From this arose a project to photograph "exiled residents" in front of their red stickered homes, or the land where once they had a home. Each photograph is accompanied by a brief account of the post-earthquake life of one of the people in the photograph. As someone who has shared the experience of those he photographed I felt he did an extremely good and sensitive job.Come and visit Kaiapoi to check out the exhibition. It is of modest size so won’t take up too much time. The library is on Williams Street, immediately before the Kaiapoi river.Kaiapoi library.

Fair Insurance Code FAQ – Part 1

The FAQ (Frequently Asked Questions) is not part of the Revised Code, just an explanation of the Review process and some of the positions taken by ICNZ on particular issues. While the FAQ may give an idea of what is intended in the Revised Code, it cannot be used to make an insurer interpret the Revised Code in any particular way. Parts of the FAQ are purely background information so there is no reason to comment on them. Other parts are revealing, and a few give reason to believe that some of what is promised in the Revised Code is shadow rather than substance. We will do this in three posts to keep the amount of reading down. Please click on the link to continue.

Assessing the ICNZ Revised Fair Insurance Code - Part 3

This post considers the final part of the Revised Code. As we move towards the way claims are processed there are welcome improvements.

ICNZ make a more detailed response.

Thursday’s blog covered the Insurance Council of New Zealand’s (ICNZ) response to an article on an insurance business website. The article featured the Avonside Blog’s commentary on the revised Fair Insurance Code. The ICNZ response was strongly critical.On Friday Tim Grafton, CEO of ICNZ, made a more detailed response elaborating on his earlier criticisms and pointing to the beneficial changes that have been made. You can read that response here. .

Assessing the ICNZ Revised Fair Insurance Code - Part 2

As we get further into the Revised Code the number of new issues raised slows down. Where the Revised Code deals with straight-out mechanical areas it works better and there is more clarity about what an insurer needs to conduct it’s business.  Despite this the position of the customer does not improve. Click on the link to read more nitty gritty.

Where to from here for ICNZ?

First, a minor correction regarding yesterday's post. The title, as originally posted, was almost what was intended, but not quite so my apologies for that. It was a bit of tongue in cheek and there was supposed to be a question mark at the end of the title – the omission was missed and I have now put one there. Even the Avonside blogger can get a little irritated and distracted when a lot of hard work is dismissed off-hand as "ill-considered" (oops, “ill-informed”.I was going to continue the analysis of the Revised Code this morning but that has been deferred until tomorrow. Instead it would be useful to briefly consider what ICNZ might do from here. Clearly they are unhappy with what has been termed the "ill-considered" (oops again, “ill-informed”) views expressed on this blog.  If that is the well-considered view of ICNZ then, presumably, nothing further will be said because they have put their case as succinctly as they can. Should, however, they do think t…

The Empire strikes back?

A journalist for Insurance Business Online yesterday wrote an article entitled New code slammed by earthquake blogger (here). It is a concise and well organised look at how the Revised Code is being analysed on this blog.Shortly after the article was published Tim Grafton, Chief Executive of the Insurance Council of New Zealand (ICNZ), made the following comment:Surprised and disappointed that this ill-informed blogger, who did not submit on the new Code, was given such prominence and our views were not sought. The Code’s timeframes for responding to customers follow best practise …The rest of the comment is the standard PR stuff used in damage control situations. So, does this blogger resemble the description of being “ill-informed” and “did not submit”?The CanCERN newsletter for 20 February this year has an article on the Avonside Blog starting up again. Part of the text reads "Lawrence was the main man behind CanCERN’s submission to the Insurance Council on the revised code&qu…

Assessing the ICNZ Revised Fair Insurance Code - Part 1

Now we get to the nitty-gritty. If a paragraph by paragraph analysis isn't your thing come back next week, when we will be looking at the important stuff that was left out of the Revised Code. Click on the link to continue reading.

Comments on the ICNZ Revised Fair Insurance Code - Part 3

Some general issuesThese issues arise in various parts of the Revised Code. It is useful to keep them in mind while reading the Revised Code, to see how there is a continual stacking of the document with content that favours insurers and puts customers at risk.Keeping each other informed: As mentioned previously there is heavy emphasis on customers informing the insurer of existing and changing circumstances. This is understandable, as such information is key to the insurer knowing the status of the risk associated with the policy. Consequently, the Revised Code is laden with obligations on the customer to be forthcoming and fulsome about this. There is, however, no equivalent obligation placed upon insurers. Section 8 of the FAQ accompanying the Revised Code excuses insurers from making an effort to provide lists of required information or summaries of policy wordings. In the absence of suitable lists and explanations customers, who are not experienced with insurance contracts, are b…

Comments on the ICNZ Revised Fair Insurance Code - Part 2

The whole viability of the insurance industry depends upon utmost good faith which, according to ICNZ on their website here, means: An insurance policy is a contract of ‘utmost good faith’ between the insurer and the customer. The insurer is required to observe and honour the contract conditions. The customer is required to disclose to the insurer all material facts that could affect the risk. For example, a person who travels overseas and leaves their house empty needs to tell their insurer, as an empty house is more risky to insure than an occupied one. Failure to tell your insurance company everything they need to know to assess your risk accurately may jeopardise your insurance cover. If in doubt about what you need to declare, ask your insurance company. A rule of thumb is that you should declare any information that would make the insurer alter the terms and conditions of your contract.As is easily seen, the weight of the so-called “utmost good faith” obligation falls entirely …

Comments on the ICNZ Revised Fair Insurance Code - Part 1

An initial reading of the Revised Code creates the impression of it being a reasonable document. If you were not familiar with what had happened with insurance claims post-earthquake a second glance would seem unnecessary. To not take a second look at the words used, but bask in the warmth and comfort promised by the publicity hype, would be a dangerous oversight. Dangerous because post-earthquake insurance claims created an environment which highlighted both new and existing problems, and these have not been dealt with. Disasters bring about the unexpected, create new problems, and put people on the spot. The major initial problem was the scale of the work facing insurance companies. As with EQC and the Christchurch City Council, the scale of the problem was beyond both their organisational ability to respond and also the adaptive capacity of most of the leadership. Adding complexity to this was was the rapid involvement of re-insurers whose sole interest was reducing their exposu…

The Revised Fair Insurance Code

There has been a flurry of insurance related developments this month. Recently EQC covertly released a Customer Interaction Review on how they had performed and on Monday Vero released a report about Canterbury four years on, outlining Vero's experiences, the improvements made to it's processes and how it envisages future disasters should be handled.

The most significant release has been that of the Insurance Council of New Zealand (ICNZ) who announced their Revised Fair Insurance Code. The Fair Insurance Code is the code of conduct all major insurers have signed up to and, in general terms, it outlines how an insurer is required to behave.

Despite the glowing terms with which ICNZ have described their Revised Code a close reading of it shows they have produced very little in the way of a fair, transparent or customer friendly way of doing business.

The effect of much of what was raised by submissions has been changes to treat some of the surface issues, but not …

The Avonside Blog will be back in action soon

There are a couple of items of unfinished business relating to insurance and Official Information Act requests to be addressed. As a result there will be a few postings over the next couple of weeks.