Pressure prompts claims offload

Quake-hit Christchurch homeowners say IAG is ‘‘dumping’’ them from its rebuild programme.

The insurer on Thursday said it would cash-settle 2000 customers due to have house repairs or rebuilds so it could meet its claims settlement deadline.

Customers who were vulnerable or needed support would be retained.

Christchurch resident Joanne Hotere said her parents were shocked and furious when they found out they would be cashsettled after months working on a rebuild plan.

‘‘They absolutely don’t want to take a cash settlement and I don’t think they’ll be able to manage their own rebuild.’’

Two other upset homeowners said IAG contacted them this week, changing their rebuild claim to a cash settlement. One said geotechnical reports had been done and a builder agreed on. They did not want to be named for fear of jeopardising their claim.

They felt they had been ‘‘dumped’’ from the programme and believed the IAG offer would not cover their rebuild.

IAG spokeswoman Renee Walker said the company was under pressure to meet its June 2016 deadline to settle all its claims and cash-settling was a ‘‘quicker option’’.

The insurer was still receiving hundreds of referrals from the Earthquake Commission, she said.

‘‘We can’t continue to put these claims into our programme and expect to complete it in the timeframe we have committed to.’’

The 1100 customers who had already signed a contract with a builder would go ahead with the insurer-managed rebuild, she said.

A Christchurch builder, speaking anonymously, said he had had dozens of contracts ‘‘ready to go’’ but was told by IAG not to sign them.

He warned that cash settlements could leave homeowners out of pocket as initial scopes did not allow for variations that emerged after construction started.

The process would be a ‘‘huge mess’’ – many customers were illequipped to manage complex repairs and rebuilds, he said.

Canterbury Communities’ Earthquake Recovery Network spokeswoman Leanne Curtis said some homeowners might not fit the vulnerable category but after 4 1⁄2 years ‘‘they have no ability left to process things’’.