Seismics and the City – Creating a Greater Christchurch – Envisioning. Engaging. Energising was held on 27th March 2015, Christchurch. Engaging Quake Claimants and Community Networks- Learning from complex claims and local knowledge.

1. 27 March 2015
Community interaction –
learning from complex claims

2. Inherent complexities
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» Open-ended insurance cover – all negotiable
» Extreme environmental factors:
» Ongoing seismicity
» Large tracts of poor land
» Other damage that is not damage to building under the
insurance policy – increased flooding risk, risk of rock fall etc.
» Legacy environmental issues: contamination, heritage
» Continued flow of claims from EQC – customer distress
» Unique two-tiered cover: EQC and private insurer
» Customer base and their issues increasingly complex over time –
strategies to respond need to evolve

3. Introduction
» Unprecedented scale in terms of insurance response with over
50,000 claims across five categories:
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Claim type Number
Over cap on 7,348 properties 12,171
Out of EQC scope 23,796
Contents 2,911
Temporary accommodation 15,695
Loss of rent 2,180
TOTAL 56,753
» 7,348 overcap and 21,583 out of scope claims notified as at 28
February 2015
» 22,773 or 78.7% of those claims now fully settled (57% of overcap)

4. Overcap Claims notifications – what’s been happening
4
» New claims continued to be notified strongly in 2014
4
through 2013
end of 2014
 New claim numbers grew steadily from the start of 2011 and
flattened out at the end of 2012 before climbing again in 2014.

5. Community interactions
» Community forums
» Coordinated support with various community groups, i.e. CanCERN and CETAS
» Targeted rebuild and repair workshops – to give customers “comfort”
» MPs and their staff
» Protest movement
Objective is to both learn and share
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6. Response to complexities
» “Qualitative easing” – still being fully embedded into operations
 consideration also given to additional information presented by customers from reputable
independent experts
 independent review of disputed claims - dedicated team with access to independent experts in
engineering, geotechnical and quantity surveying to assist with resolution
 assisting customers to obtain their own independent advice from reputable sources.
» Encouragement of Residential Advisory Service (RAS) and CanCERN’s Breakthrough
initiative
» Internal Solutions team – complex one-off issues
» Customer Support team – targeted assistance for vulnerable customers, including “wrap
around” care via MSD-funded initiative
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7. Vulnerable customers – whole portfolio
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11/08/2014 8/09/2014 13/10/2014 11/11/2014 4/12/2014 15/01/2015 10/02/2015 10/03/2015
Maintenance 12 14 18 20 25 31 31 40
Construction 43 51 65 71 77 90 92 99
Contract 29 38 45 41 42 32 30 22
Documentation 100 106 115 123 122 129 135 158
Predesign 137 142 129 132 144 142 147 140
No Decision made 73 70 74 65 71 68 67 69
OOS 26 26 34 37 31 40 41 50
Temp. Accom 2 1 1 3 1 1 1 2
0
100
200
300
400
500
600
700
Claims
Vulnerability Progress as at 10/3/15

8. Vulnerable customers – whole portfolio
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11/08/2014 8/09/2014 13/10/2014 11/11/2014 4/12/2014 15/01/2015 10/02/2015 10/03/2015
Maintenance 12 14 18 20 25 31 31 40
Construction 43 51 65 71 77 90 92 99
Contract 29 38 45 41 42 32 30 22
Documentation 100 106 115 123 122 129 135 158
Predesign 137 142 129 132 144 142 147 140
No Decision made 73 70 74 65 71 68 67 69
OOS 26 26 34 37 31 40 41 50
Temp. Accom 2 1 1 3 1 1 1 2
0
100
200
300
400
500
600
700
Claims
Vulnerability Progress as at 10/3/15

9. 9
Vulnerable customers –
end-to-end management
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11/08/2014 8/09/2014 13/10/2014 11/11/2014 4/12/2014 15/01/2015 10/02/2015 10/03/2015
Maintenance 1 2 3 3 5 5 4 6
Construction 3 4 8 10 11 16 16 18
Contract 3 5 10 9 11 8 9 7
Documentation 15 26 28 30 30 39 44 52
Predesign 6 30 30 35 41 45 46 49
Decision 15 22 25 21 24 20 22 22
0
20
40
60
80
100
120
140
160
180
Claims
Customer Support Team - progress excl OOS as at 10/3/15

10. 10
Vulnerable customers –
end-to-end management
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11/08/2014 8/09/2014 13/10/2014 11/11/2014 4/12/2014 15/01/2015 10/02/2015 10/03/2015
Maintenance 1 2 3 3 5 5 4 6
Construction 3 4 8 10 11 16 16 18
Contract 3 5 10 9 11 8 9 7
Documentation 15 26 28 30 30 39 44 52
Predesign 6 30 30 35 41 45 46 49
Decision 15 22 25 21 24 20 22 22
0
20
40
60
80
100
120
140
160
180
Claims
Customer Support Team - progress excl OOS as at 10/3/15

11. Partnership among insurers addressing shared property
issues
» Examining the prospect of co-locating with another insurer
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CCC District
Plan review
Under-
insured / no
insurance
Owner
decision-
making
Title issues
Other
insurer
position
Complex
regulations
EQC
Declaratory
judgment
Cash
settling vs.
Building
Shared
Property
buildings

12. Other examples of industry cooperation
» District Plan Review
» Joint efforts to improve customer experience in the recovery
» Retaining walls, land surveying – united response in an attempt to overcome
barriers to progress
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13. Future significant challenges to be fully addressed
» Repairs portfolio
 Disputed methodology – inadequate communications
 Customer’s preference for a rebuild where existing house can be
repaired to the policy standard
» Multi unit progress
 Customer agreements and courses of action
» Court capacity issues - spurious Court actions delaying progress
 One lawyer has 86% of all outstanding High Court cases
 66% of those are undercap – all recent notifications – since May 2013
 Southern Response working with EQC to address this phenomenon
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14. Court capacity issues – spurious actions
1414
Defendant
Number
of cases
filed
Insurer’s
total of
residential
EQ List (%)
Plaintiff
representation
by one lawyer
Insurers'
% by that
insurer
Overcap
% of
insurer's
total
Undercap
% of
insurer's
total
Cases open
Southern
Response
96 33% 78 81% 48% 52% 79
IAG 77 27% 57 74% 38% 62% 58
Tower 50 17% 36 72% 72% 28% 24
Vero 23 8% 17 74% 52% 48% 15
Lumley 28 10% 25 89% 43% 57% 24
AA 17 6% 17 100% 53% 47% 13
Allianz 1 0.3% 0 0% 0% 100% 0
MAS 2 0.7% 1 50% 100% 0% 2
Total 288 225 78% 51% 49% 210
unresolved 180 Only 30 cases open
from other than one lawyer% of all open 86%

15. Supporting alternative methods of dispute resolution
» “Discourage litigation. Persuade your neighbors to compromise whenever you can. Point out
to them how the nominal winner is often a real loser – in fees, expenses, and waste of time.”
- Abraham Lincoln, Notes For a Law Lecture, July 1, 1850 – still true today
» We support
 ISO facilitation (voluntary removal of $200k cap on ISO’s jurisdiction)
 RAS facilitated Multi Party Meetings
 Court mediation
 Reputable advocate involvement
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