Parliament has passed the Canterbury Earthquakes Insurance Tribunal Act 2018, to help Cantabrians resolve outstanding residential insurance claims from the 2010 and 2011 earthquakes.
The Act applies to disputes between policyholders and insurers and/or EQC about insurance claims for physical loss or damage arising from the Canterbury earthquakes, being the earthquakes and aftershocks that occurred between 4 September 2010 and 31 December 2011. However, the Act does not apply if ownership of a building, property, or land had been transferred to the policyholder or insured person under a sale and purchase agreement following the physical loss or damage giving rise to the insurance claim. It also does not apply to claims arising from other recent earthquakes.
The Act provides for a claim to be brought to the Tribunal, either:
- by a policyholder or an insured person bringing a claim to the Tribunal against an insurer or the EQC (or both); or
- by the transfer of proceedings from a court to the Tribunal.
Only policyholders will be able to bring proceedings in the Tribunal; EQC and insurers cannot initiate a claim.
The Act provides for the mediation of claims and mediation processes, where the Tribunal directs the parties to mediation. If the parties choose not to mediate, or the mediation is unsuccessful, then the dispute will be heard by the Tribunal.
The Tribunal will be able to decide both liability and remedies. The Act provides:
- for the Tribunal to make any order that a court could make in accordance with the terms of an insurance contract in dispute, and the general law of New Zealand, including contract law and the Earthquake Commission Act 1993;
- that the Limitation Act 2010 and any other enactment that prescribes a limitation period or other limitation defence will apply;
- for an order for the payment of general damages (for example, for mental distress);
- for an order for costs and expenses, if the contract of insurance provides for these;
- if an order requires a party to do something, other than pay money, for the Tribunal also to set an amount of money that would be payable, and the date by which that amount is payable, if they fail or refuse to do that thing by that date;
- if the Tribunal decides that a party is liable to make a payment to another party, for the Tribunal to make the payment subject to any conditions;
- for the Tribunal to decide that the liability of a party depends on another party meeting particular conditions; and
- for the Tribunal to terminate a claim where it is settled by agreement between the parties before the Tribunal decision is given and, if requested by the parties, to record the settlement in the form of a decision.
The Act will come in to force on the day after it receives Royal assent, or 10 June 2019, whichever is later. The next steps will be to appoint the members of the Tribunal and to establish offices.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.