Tower chair­man frus­trated by hold­outs

The Dominion Post - - Business - ROB STOCK

Tower chair­man Michael Sti­assny has crit­i­cised some Can­ter­bury earth­quake vic­tims for hold­ing out on set­tle­ments to ‘‘max­imise’’ their in­sur­ance claims.

Sti­assny showed his frus­tra­tion in re­ply to a ques­tion at Tower’s an­nual meet­ing yes­ter­day.

Speak­ing af­ter the meet­ing, Sti­assny said there was an in­dus­try of lawyers and en­gi­neers ‘‘mak­ing it their busi­ness to take claims to court’’.

He said many peo­ple in Christchurch had been ‘‘through hell’’, but said among the re­main­ing claims yet to be set­tled were peo­ple seek­ing to ‘‘max­imise’’ their re­turns from Tower.

‘‘A num­ber of these peo­ple are not in any form of hard­ship, and are ba­si­cally en­gag­ing in ac­tions to max­imise re­turns,’’ Sti­assny said.

‘‘That’s what I’m en­ti­tled to be ag­grieved about as chair­man of an in­sur­ance com­pany.’’

It was in Tower’s in­ter­ests in some cases to set­tle to bring these cases to an end, How­ever, Sti­assy said, ‘‘It’s not our job to pay over the odds.’’

Tower’s job was to pay what was fair to pol­i­cy­hold­ers, he said.

Some of the hold­outs were liv­ing over­seas, he said.

Tower’s fi­nan­cial per­for­mance con­tin­ues to be dogged by the legacy of the Can­ter­bury quakes. The NZX-listed com­pany re­ported a loss in the year to the end of Septem­ber 2016 of $21.5 mil­lion.

Chief ex­ec­u­tive Richard Hard­ing said there had been a $25.3m im­pact from ad­di­tional pro­vi­sions for Can­ter­bury, as the Earth­quake Com­mis­sion (EQC) dis­cov­ered more ‘‘over­cap’’ claims more than six years af­ter the earth­quakes.

EQC pays the first $100,000 plus GST of earth­quake claims on house in­sur­ance. If dam­age costs more than that to fix, the claim is ‘‘over­cap’’ and home­own­ers’ pri­vate in­sur­ance kicks in.

‘‘The legacy from the Can­ter­bury earth­quakes re­mains a dif­fi­cult and com­plex sit­u­a­tion,’’ Hard­ing said.

‘‘Six years on, in­sur­ers still do not have clar­ity on the num­ber and value of claims that re­main.’’

Sti­assny called the ap­pear­ance of over­cap claims six years af­ter the earth­quakes ‘‘amaz­ing and dis­ap­point­ing’’.

Deal­ing with Kaik­oura quake claims was sim­pler as all poli­cies were now ‘‘sum as­sured’’ poli­cies, where in­sur­ers have a max­i­mum li­a­bil­ity, and usu­ally set­tle claims for cash pay­ments.

There is un­cer­tainty over Tower’s fu­ture as Aus­tralian in­surer Sun­corp and Fairfax Fi­nan­cial Hold­ings have made bids to buy it.

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