Top-up payment coming for hundreds of Canterbury earthquake claimants

Source: 1News

A “top-up” has been approved today for hundreds of Canterbury homeowners who settled their earthquake claims with Government-owned insurance company Southern Response.

The full amount announced today is yet to be determined. But, lawyers have previously claimed as much as $500 million owed to 3000 claimants.

The long-awaited move comes after Southern Response lost several legal battles over their pay-outs to claimants, like Christchurch couple Karl and Alison Dodds. The High Court last year found they had been misled and deceived by Southern Response, who kept a higher estimate to rebuild their quake-damaged home secret.

Earthquake Commission Minister David Clark said the policy would affect eligible policyholders who settled with the insurance company before October 2014. 

“The roll out of this package is intended to address the inequity of those who settled their claims prior to October 2014 compared to those who settled later,” he said. 

The proactive payout today comes after the Crown in September opted not to pursue the Dodds’ case further , after a Court of Appeal ruling that upheld the High Court’s decision. 

It also comes amid class action against Southern Response by Brendan and Colleen Ross. They started proceedings in court against the insurance agency. 

The class action represents about 3000 policyholders who believe they may have been misled by Southern Response. The Court of Appeal ruled an "opt-out" class action suit could be brought against Southern Response on behalf of former policy holders.

The package may affect some policyholders who are part of the class action. Southern Response is applying to the court for confirmation today that it can communicate with those policyholders about the package. 

The top-up process would be managed by an independent panel made up of former Mayor of Waimakariri David Ayers (chair), lawyer Nina Khouri, Santra Manderson, a former New Zealand Police District Commander who worked in Canterbury following the 2011 earthquakes, and audit and risk director Fiona Mules.