Peter Rose, CE, Southern Response Earthquake Services Ltd - Speaking at Seismics and the City 2015

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    19-Jul-2015

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August report

27 March 2015Community interaction learning from complex claims1Inherent complexities2Open-ended insurance cover all negotiableExtreme environmental factors:Ongoing seismicityLarge tracts of poor landOther damage that is not damage to building under the insurance policy increased flooding risk, risk of rock fall etc. Legacy environmental issues: contamination, heritageContinued flow of claims from EQC customer distressUnique two-tiered cover: EQC and private insurerCustomer base and their issues increasingly complex over time strategies to respond need to evolve2IntroductionUnprecedented scale in terms of insurance response with over 50,000 claims across five categories:3Claim typeNumberOver cap on 7,348 properties 12,171Out of EQC scope23,796Contents2,911Temporary accommodation15,695Loss of rent2,180TOTAL56,7537,348 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)Overcap Claims notifications whats been happening4New claims continued to be notified strongly in 2014

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through 2013 end of 2014New claim numbers grew steadily from the start of 2011 and flattened out at the end of 2012 before climbing again in 2014. Community interactionsCommunity forumsCoordinated support with various community groups, i.e. CanCERN and CETAS Targeted rebuild and repair workshops to give customers comfortMPs and their staffProtest movement

Objective is to both learn and share5Response to complexitiesQualitative easing still being fully embedded into operationsconsideration also given to additional information presented by customers from reputable independent expertsindependent review of disputed claims - dedicated team with access to independent experts in engineering, geotechnical and quantity surveying to assist with resolutionassisting customers to obtain their own independent advice from reputable sources.Encouragement of Residential Advisory Service (RAS) and CanCERNs Breakthrough initiative Internal Solutions team complex one-off issuesCustomer Support team targeted assistance for vulnerable customers, including wrap around care via MSD-funded initiative6Vulnerable customers whole portfolio7Vulnerable customers whole portfolio89Vulnerable customers end-to-end management910Vulnerable customers end-to-end management10Partnership among insurers addressing shared property issuesExamining the prospect of co-locating with another insurer11CCC District Plan review Under- insured / no insuranceOwner decision-makingTitle issuesOther insurer positionComplex regulationsEQC Declaratory judgmentCash settling vs. BuildingShared Property buildingsOther examples of industry cooperationDistrict Plan ReviewJoint efforts to improve customer experience in the recoveryRetaining walls, land surveying united response in an attempt to overcome barriers to progress

12Future significant challenges to be fully addressedRepairs portfolioDisputed methodology inadequate communications Customers preference for a rebuild where existing house can be repaired to the policy standardMulti unit progressCustomer agreements and courses of actionCourt capacity issues - spurious Court actions delaying progressOne lawyer has 86% of all outstanding High Court cases66% of those are undercap all recent notifications since May 2013Southern Response working with EQC to address this phenomenon

13Court capacity issues spurious actions1414DefendantNumber of cases filedInsurers total of residential EQ List (%)Plaintiff representation by one lawyerInsurers' % by that insurerOvercap % of insurer's totalUndercap % of insurer's totalCases openSouthern Response9633%7881%48%52%79IAG7727%5774%38%62%58Tower5017%3672%72%28%24Vero238%1774%52%48%15Lumley2810%2589%43%57%24AA176%17100%53%47%13Allianz10.3%00%0%100%0MAS20.7%150%100%0%2Total 28822578%51%49%210unresolved180Only 30 cases open from other than one lawyer% of all open86%Supporting alternative methods of dispute resolutionDiscourage 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 todayWe supportISO facilitation (voluntary removal of $200k cap on ISOs jurisdiction)RAS facilitated Multi Party MeetingsCourt mediationReputable advocate involvement15

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