Some home owners who suffered damage to their property with the weekend's wild weather could be waiting months for it to be fixed with a major insurer warning that claim settlement timeframes have blown out due to supply chain and labour issues.
But the insurance industry body says those who need quick repairs to make a house habitable again are being prioritised.
Tom Bartlett, head of home claims for AA Insurance, which is jointly owned by Suncorp and The Automobile Association, said it had seen a shift in claim settlement times for house, contents and vehicle insurance because of the availability of replacement goods and delays on certain building materials.
"In some cases, such as with construction materials, claims can sometimes take weeks, if not months longer to settle than they normally would, while for others, such as household items and some electronics, customers may only see a delay of a few days."
Bartlett said building claims were seeing the biggest impact from delays but motor insurance claims were also experiencing significant wait times for parts due to shortages in the country, slowed production of vehicles and parts globally, and shipping lines continuing to be significantly disrupted and delayed since the start of the pandemic.
"In an increasing number of instances, customers could be waiting three months or more for parts to arrive for their vehicle to be repaired."
He said the rising value of second-hand cars due to production and supply shortages was also affecting the amount that vehicles were insured for and he urged people to review their policies to ensure they had enough cover in place to pay for repairs or a settlement that would enable replacement of the vehicle if it was damaged beyond repair.
"During the last 22 months the used car market has been appreciating in value, rather than depreciating. This has proven challenging at claim time because the cost to buy a replacement vehicle has, in some cases, changed."
Bartlett said AA Insurance was also working around this issue by obtaining a pre-accident valuation of the vehicle to base the settlement on rather than a nominated sum insured amount.
Meanwhile global shortages for products like silicon, which was used in computer chips, had created shortages in many electronic products for cars (as well as contents), and costs had been driven up, when stock was available.
Bartlett said the supply chain issues became more obvious after a weather-related event.
"For example, after the Hawke's Bay flooding in late 2020, New Zealand became very close to running out of whiteware products because of the volume of replacements needed across the industry to respond to the event."
At the moment it was having the most issues with sourcing electronics such as laptops and TVs.
"Although there is availability, it's not across all brands and models, which can make it difficult when trying to replace items similar to those owned by customers."
A spokesman for the Insurance Council of New Zealand said most house insurance claims were still being settled in a timely way.
"There is though an issue with settling some claims due to local or international supply constraints, or a shortage of people to do the work where there is a very high demand for building work generally.
"For some claimants, if they have a specific requirement, say for materials that come from overseas, then that can indeed lead to significant delays. Generally though, in the case where quick repairs are needed to make a house habitable again for instance, that's not generally a problem."
The ICNZ spokesman said when it came to vehicle claims most were still quick to settle.
"However, there are instances where a particular component for particular vehicles are difficult, or time consuming, to source. This is an issue common to all manufacturers.
"It seems as though supply chain issues over the last couple of years have led to a draw-down of local spares due to offshore supply chain issues. Now the buffer is depleted, in some cases, repairs are waiting on parts that have to be sourced directly from overseas. Some parts can take between 12 and 20 weeks to get to a repairer. There have been some instances where even these timelines are not met."
He said that meant in some cases insurers were taking the option to write off cars and paying cash out where that might not have been the case in the past. In other cases if the damage was minor and the vehicle was still safe and legal to drive they could continue driving it until the parts arrived.
Bartlett said people claiming could help themselves by being more open to look at alternatives to items which weren't available.
If people were worried about their car being out of action for months waiting for parts they could take out additional cover which provided a rental car.
The ICNZ spokesman urged claimants to talk to their insurer about their options.
"Some insurers offer a rental car option (either fully funded or subsidised) on their comprehensive policies if consumers choose to take that up when they take up their insurance."
Bartlett said those who lost their home to a fire or flood were covered under house and contents insurance for up to 12 months temporary accommodation.
"With current pressures on the rental market we work with customers to understand what they need and not only look at regular rentals, but other options like Airbnbs, hotels or transportable homes to locate on their land. The options we consider depend on what is right for the customer and their situation and extends to temporary accommodation for their domestic pets as well."
The ICNZ spokesman said consumers should not hesitate to make a claim if they needed to.
"The sooner they do the sooner things can be put right. Most of us understand that things are different these days and are more accepting when there are delays and why it might make sense to approach things in a different way if that means getting the job finished sooner."
Bartlett said the insurance industry was already facing challenges prior to Covid including labour shortages and supplier capacity.
"Getting people into the country to help reinforce our trade workforce is much harder, which is reducing the capacity of our supplier networks overall, particularly in motor repair industries."
In addition there had been a lot of continuous growth in the building sector pre-Covid as well as the last 22 months with more renovations, improvements, new builds, and DIY spending putting additional nationwide pressure on supplier capacity and supply of materials.
"To give a bit of context, at the beginning of 2021, we had builders who were already booked for work until 2022 for their non-insurance workloads."
Bartlett said it was impossible to know when the supply chain issues would come to an end.
"This is unlikely to go on forever, however we continue to monitor the situation and based on medical and government experts, it appears we are likely to see more of the same in 2022."
In the meantime it was asking people to be patient.
"We understand waiting can be frustrating, but we will continue to communicate any delays and can assure customers we are doing our very best to get their claims sorted as quickly as we can and appreciate their patience."
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