Quake most costly NZ insurance event

Photo / Herald on Sunday

The cost to insurers of the Canterbury earthquake is now estimated at $1.5 billion, making it New Zealand's largest single insurance event.

Insurance Council chief executive Chris Ryan announced the figure today, and warned premiums could rise throughout the country as a result of the quake.

"The size of increases is very hard to predict as there are forces driving premiums down as well as up," he said.

"However, the large part of the $1.5 billion now estimated to be paid to New Zealand comes from international companies, and over the next few years there is likely to be some cost to all insured parties as a consequence."

The task of repairing moderately and seriously damaged homes in Christchurch is due to begin next week, with the first project management site office being established in Halswell in the south-west of the city.

Earthquake Commission (EQU) chief executive Ian Simpson said offices would be established in Rolleston and Kaiapoi early next month once locations had been agreed with the local council.

The initial location was chosen because work could begin there on a significant number of homes that were not affected by land remediation issues.

Fletcher Construction, the project manager for the rebuild, said more than 600 contractors and trades people had made contact through the earthquake recovery website and the necessary accreditation process was under way.

Meanwhile, the large majority of Christchurch central city businesses whose buildings were temporarily out of action following the September 4 quake are back operating.

A survey conducted by the Canterbury Development Corporation (CDC) found 86.7 per cent of businesses that were initially not allowed into their buildings because of damage were now up and running.

CDC spokesman Simon Worthington said that of the businesses not trading at the time of the survey, 35 per cent were intending to restart once their building was accessible and another 35 per cent would begin trading in a different building.

"At this stage, none of the businesses not currently trading was intending to wind up the businesses, with 30 per cent having not made a decision at the time of the survey," he said.

According to the survey of 152 businesses, the payment of wages was still a major issue for businesses affected by the earthquake, with 37 per cent using the government wage subsidy assistance.

Mr Worthington said many businesses had experienced a major downturn or a complete halt of cash flow and might need a small injection of funds, whether a loan or grant, to assist them into alternative premises.

"Cantabrians are urged to help these businesses by visiting and spending money in the CBD."

- NZPA