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Xu and Bryant - The Supreme Court decision

The Supreme Court has issued its decision in Xu v IAG. A split decision with 3 Justices (William Young, O’Regan and Ellen France JJ) against the appeal and 2 Glazebrook and Arnold JJ dissenting. My quick reading is that Bryant is still in force, although clarified and somewhat limited. The Majority appear to have been swayed by moral risk arguments that are, in my view over-stated (the learned Paul Michalik advises that 19th century insurers lobbied for and got the right to re-instate precisel...

July 3, 2019

More bad news for the insurance Industry

Consumer New Zealand has published the results of a survey showing that public trust and confidence in the insurance industry is low (1). The specific conclusions from the study are: Our latest survey research found:Consumer trust in the insurance industry was low.  Just 13% of consumers felt confident insurers could be trusted.Only 8% thought insurers always offered fair terms.Just 18% felt they fully understood their insurance policy.As many as one in four have had a problem with their in...

June 24, 2019

Does the building code need to be re-vamped?

There has been a lot of comment lately about whether the building code is fit for purpose(1). This is wrapped up in the media/PR drive around "risk based pricing" and coincides with concerns around the safety of modern compliant buildings under earthquake conditions. The argument is that new, fully code compliant buildings failed in the Canterbury Earthquake sequence (CES) and in Wellington during the Kaikoura Earthquake, therefore, the code must be flawed or faulty. The Insurance Council (ICNZ)...

June 19, 2019

Radio New Zealand interview

Insurance in New Zealand is about to go some significant changes, I was invited to give my opinion on an aspect of this on Radio New Zealand this morning. Please listen below (I'm on for the last 10 minutes)https://www.rnz.co.nz/national/programmes/ninetonoon/audio/2018697237/is-the-property-insurance-market-broken...

May 29, 2019

New Zealand Law Journal Article - can 'indemnity plus' claims rights be assigned?

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May 1, 2019

Lost in Translation

Note this article was originally published by Legalwise https://legalwise.com.au/nz/insurance-non-disclosure-lost-in-translation-for-esl-speakers/IntroductionNew Zealand is a nation of immigrants, the 2013 census showed that one in four Kiwis were born overseas. If new migrants do not have good English, problems can arise when contracts are entered into. In applications for insurance policies, which require often large amounts of relatively complex personal information, there are significant pro...

April 11, 2019

Sharing the risk - update

So we've heard that IAG's reason for ceasing to offer domestic insurance in Wellington is because they are over-exposed in the region. Apparently IAG through its many and varied brands (State, AMI, Lumley, various Bank products, Lantern, and NZI) has over 50% of the market in Wellington. I'm not sure if this is just in the domestic market or also in commercial property as well (IAG have a large commercial book as well). This suggests that IAG is being prudent (over-exposure in Christchurch and l...

March 14, 2019

Sharing the risk?

In light of news that insurers are now using "risk based pricing"* which means that "high risk areas" won't be offered certain classes of business https://www.radionz.co.nz/news... I thought I'd offer some thoughts on the performance of the domestic insurance market in New Zealand since 2010 (specifically since September 2010). The reason for my musings are that since the CES events, earthquakes are a bit of a trojan horse/bogeyman. For example, if you talk to geophysicists, their asse...

February 12, 2019

The Reserve Bank and FMA review of the life insurance industry

The Reserve Bank and FMA have publicised their findings of poor practices within the life insurance industry; https://fma.govt.nz/news-and-r... . The review raises issues around culture and practice in sales and claims. It's no secret that there have been concerns around the use of sales incentives for brokers and other intermediaries in the sale of life policies, for a number of years, and I am unsurprised by the outcome of this aspect of the review. It's also no surprise that there a...

January 30, 2019

Canterbury Earthquakes Insurance Tribunal Bill

Yesterday, 1 August 2018, the Ministry of Justice published the a bill to establish an insurance Tribunal to address insurance disputes arising from the Canterbury Earthquake Sequence of 2010 in 2011. The Tribunal will be called the Canterbury Earthquakes Insurance Tribunal ("the Tribunal").  This development is welcome although as with anything, the devil is in the details. My thoughts are: THE GOOD That the tribunal is being established at all is a great development and all credit to the...

August 2, 2018

Insurance Contracts Law review, part 2, the return of the detailed submission.

My detailed submission to MBIE's review is completed and I'll add a link below. In short, it's my view that changes in the insurance industry and technology advances over the last 20 years mean that there is an imbalance between insurers and insureds, particularly for consumers and S.M.E. This imbalance is problematic, as it means that fairness is a matter of internal practice by insurers who are, at the very least, large national organisations, and more likely than not, multinationals. The...

July 11, 2018

Granular underwriting and the death of risk sharing?

Tower recently announced that it would be moving to a "risk pricing model" recently and we are now seeing the effect of that with premiums rising, or really rocketing for some Wellington customers due to perceived earthquake risk; https://www.radionz.co.nz/news.... Now leaving aside whether risk pricing is simply underwriting, or whether as accurate assessment of earthquake risk can actually be made without detailed geotechnical and structural engineering information specific to an individu...

June 20, 2018

Insurance Law Review

This article first appeared in Legalwise as an industry update http://www.legalwiseseminars.c...The Ministry of Commerce and Consumer Affairs has announced a review of New Zealand’s insurance legislation. The review will consider a number of issues, but it is likely that the review will lead to legislation to update and consolidate law as it currently stands. New Zealand’s current suite of insurance law legislation consists of:the Maritime Insurance Act 1908, the Life Insuranc...

June 4, 2018

Justice Kos reflects on the 5 years since the Christchrurch Quakes

His Honour Justice Kos gave a speech to the Supreme & Federal Courts Judges Conference, Brisbane, On 26 January 2016. The Paper is titled DISASTER & RESILIENCE The Canterbury earthquakes & their legal aftermath. Justice Kos sat on the Earthquake list until he was elevated to the Court of Appeal last year and also adjudicated a number of important cases. I thoroughly recommend a read. DISASTER & RESILIENCE...

February 26, 2016

Insurance Claims in New Zealand is a new publication by Paul Michalik and Chris Boys

Insurance Claims in New Zealand is a new publication by Paul Michalik and I. The focus of the book is on the sharp-end of insurance; claims. Rather than creating a New Zealand version of the big English tomes which are comprehensive, academic and aimed at specialists, we have tried to make the the book approachable by anyone working in the area. This might include; brokers and advisers, general practice lawyers, insurance company claims handlers, or anyone who needs to understand what should hap...

August 4, 2015

Four years later - where are things at?

It's now over four years since the Lyttleton quake. With each year insurers and EQC have set targets, mostly these have been missed. There have been a number of judgments out of the Courts, some of which are useful to insureds, some less so. There are still over 200 unresolved cases on the EQ List. I have another 2 or three which are likely to be added in the next few months. It is of great concern that one insurer in particular, is massively over-represented in the number of cases it is defendi...

March 12, 2015

State EQ settlements - don't sign your rights away

I'm working with clients who are in the process of settling their EQ claims with State. To finalise the process the clients have been asked to sign a deed of transfer which gives all the benefits of their EQC claims, both for the land and for the house, to State.  As you may know EQC insure land and dwellings separately. EQC generally (ie 100% of the time in cases that I've seen) settle on the loss of value caused by the land damage. They do this by taking a pr...

June 24, 2014

Scarfies and Insurance

You may have seen a new story about uninsured students and the risk of liability for damage to their flats; http://www.radionz.co.nz/audio/player/2584002 and http://www.nzherald.co.nz/personal-finance/news/article.cfm?c_id=12&objectid=11193961 These stories highlight that students may not be covered if they, or their flatmates, are negligent and this causes a fire, flood or other damage to their flats, or the loss of their contents in a fire or theft. The byline is that you need insuran...

January 30, 2014

Broken crockery and expensive insurance

Two news stories have caught my attention lately which show the importance of being active with your insurance, whether it's your business insurance, or your home, car and contents. This first is about insurers profiting from people being inactive with reviewing their policies each year. The gist is that motor vehicle claims costs have gone down relative to the cost of insuring a car. The reason for this is largely that there is a lack of competitive pressure, because people just let their p...

January 27, 2014

Court update # 1 - Rout

The outcomes from the Rout case are a mixed bag for claimants. The Routs won a substantially increased settlement from what Southern Response originally offered, but not the cost of replacing their home on its existing, damaged, red zoned, Brooklands site. Justice Gendall ruled on several issues which have wide importance to other EQ claims. They are: 1.What repairs are legally necessary for homes in flood prone areas? 2.Where does the line between a repairable home and a total loss lie? ...

December 17, 2013

Risky business - insurance, earthquakes and the law.

EQC is broken and needs to be rebuilt. You’ve heard this from quake affected people in the past. Is it true or are they complaining about the inevitable? After all EQC is doing something unprecedented, the situation is complex and overwhelming, so some complaints and conflict are to be expected, right? Let’s look at the facts. The first Canterbury earthquake occurred over three years ago. In February it will be three years since the second, but the rebuild has barely begun. EQC admitted ...

December 10, 2013

Experts, earthquakes lawyers and independence. It's just not cricket.

Most people think that litigation is some sort of gentile form of cricket, elegant and sporting, but usually it's nasty and brutal. The only things that stop most cases from descending into open warfare are the rules of court. Not knowing the rules or the way the game is played puts you at a real disadvantage. Your chances of winning a case double when you get a good lawyer to champion your cause. If the amount of money at stake is substantial and you aren’t legally represented you need to ...

December 9, 2013 Posts 1-22 of 22 | Page