Christchurch Earthquake

(Last Updated: 24/12/2010)

Options for reinstating your home

There are two key options for you to consider:
1.    repair/rebuild your existing home, or
2.    request a cash settlement.

Repair or rebuild

AA Insurance will manage the repairs or rebuilding of your home to put you back in the same situation you were in before the earthquake.

Can I rebuild somewhere else?

AA Insurance can rebuild your home on a similar site elsewhere and we are happy to discuss this with you.  

What if my land needs to be fixed first?

If you would like to rebuild, and your land needs to be fixed first, you can choose to build on the same site once the land has been remediated by the EQC, or you can rebuild somewhere else if we agree.  

In terms of timeframes, the land must be fixed before any rebuilding work can be undertaken.  At this stage, the EQC have indicated that the land repairs may take up two to three years.  We will continue to work with you on making progress so that as soon as the land is repaired we are able to start.

Can I make temporary repairs to my house?

If you need to make urgent repairs to secure your property or to prevent further damage from occurring, you should do so.  Make sure you keep receipts for any work you have done.

Any repairs for non urgent work may not be fully covered.  You should contact us beforehand on 0800 426 789 if you are unsure.

Cash settlements

If you do not wish to rebuild or repair your home, you can choose to accept a cash settlement.  
Your claim will then be fully settled and AA Insurance will no longer be involved.  

It is important you understand that AA Insurance will need to pay any interested party/mortgagor listed on your policy first, we are legally required to do this.

Cash settlement - AA Insurance

AA Insurance will pay the estimated cost of rebuilding your home using our suppliers and the same or similar construction, style and materials according to the floor area size stated in your policy schedule.

You can then choose to either build a new home yourself on your current site or elsewhere, or to purchase a new home.   If you decide to cash settle and manage the repairs/rebuild to your home without the support of AA Insurance, this will also mean that AA Insurance will not be responsible for any work carried out by your own builder.  

Your cash settlement amount will have the EQC contribution and your policy excess deducted. If you choose a cash settlement, we will arrange to demolish the house once the settlement has been paid or make provision for these costs in the settlement amount.

When do I have to decide what I want to do?   

We are currently working with MWH Mainzeal to establish the full extent of damage to your home and the cost to repair/rebuild.  This means you have time to consider your options, and can make a decision when we have this additional information. 

MWH Mainzeal

Who will be repairing/rebuilding my home?

We will be working with  MWH/Mainzeal to facilitate the work involved with repairing or rebuilding your home.  They will assist with all the planning work, the appointment of contractors, building work and council approval.

Their involvement will ensure a consistent and structured approach to this process and allow our customers to be kept fully informed throughout.

MWH/Mainzeal will be contacting all of our customers by mid February to outline what the next steps are.  This may involve completing a more detailed Scope of Works and organising quotes on the reinstatement work.

About Mainzeal Property and Construction Ltd

Mainzeal Property and Construction Ltd is one of New Zealand’s largest property and construction companies with a wide range of experience in all sectors of the industry.

About MWH New Zealand Ltd

MWH is one of New Zealand’s leading infrastructure and environment consultancies and employs project managements, engineers and other specialists providing a full range of expertise in project management design and construction management services.  

Repairing or rebuilding my home

Who will pay to repair/rebuild my home? The EQC are responsible for the reinstatement of the land and up to the first $115,000 of building damage.  AA Insurance pay for the remaining building damage, according to the terms of our HomeCover policy.  

What will happen to the money I received from the EQC?

If your home is going to be repaired or rebuilt, you will be required to apply any funds paid to you by the EQC toward the repair or construction costs. AA Insurance will pay for the repair or rebuild costs once these EQC funds are exhausted.

The EQC payment is subject to an excess. This excess needs to be paid by you toward the repair or rebuild costs before AA Insurance commences its payments under the policy.

Will my house need to be demolished/rebuilt from scratch?

The EQC have indicated that some homes will probably need to be demolished and rebuilt because the cost to repair will be more expensive than to rebuild. We are waiting for more detailed reports from the EQC to establish whether this is likely to happen, what steps are required, and who would be responsible for this.  These EQC reports are expected to be completed by March/April 2011.

Can we use our own builder to conduct the repairs to our house?

All building work completed under the project management of MWH/Mainzeal is guaranteed by us.  We are not be able to provide any guarantees for building work which MWH/Mainzeal does not oversee, however, you can choose to provide quotes from your own builder for MWH/Mainzeal to consider.

What is the expected timeframe for repairs to our house?

There are several factors that impact this and each case will differ.  

These factors may include: the extent of remediation required, confirmation of designs, completion of plans, consent and tendering processes and the availability of labour and materials.

We will be working with all parties involved to ensure that the process is completed as quickly as possible to your satisfaction and that you are kept fully informed throughout.

When can the drive/wall/fence/path (non EQC damage) be repaired?

MWH/Mainzeal will be in contact shortly and are working to provide updates and timelines for you.

 If there are Health & Safety issues involved, please let us know.

Will an engineer inspect my house?

If any structural issues are suspected, MWH/Mainzeal will arrange for a structural engineer to visit and assess your property.

Will I need building consents?

If any building consent is required MWH/Mainzeal will prepare the application (including architectural drawings for submission to Council) and work with you to obtain consent.  

Can I alter or improve my house during the repairs or rebuild of it?  

There may be opportunities for you to alter and improve your home during the re-building process. We are happy to discuss this further with you as your claim progresses.

Improvement decisions made prior to the consent application being filed will need to be thoroughly discussed and agreed to with MWH/Mainzeal and the Loss Adjuster handling your claim.  Changes to the plans, cost of the improvements and who will build the improvement will need to be addressed prior to filing.

All additional costs would need to be agreed to by all parties prior to the consent application being submitted.  

When repairs to my house are completed, will it be the same as before the earthquake?

The purpose of insurance is to put you back in the same situation you were in before the earthquake so we will repair/rebuild your home to the same size and specifications with the same or similar materials.

Land damage

What if I own land that is unsuitable for reinstatement?

EQC will compensate you for the loss of some of your land; however, there are limits to this cover.  More information is available on their website www.eqc.govt.nz

How long is the land remediation going to take?

The EQC are responsible for managing land repairs and the timeframes are likely to vary depending on how they prioritise the repairs and the severity of the damage.  

The EQC have advised that it is going to take approximately six months to assess all the affected properties, and that all the required planning work is expected to be completed in March/April 2011.  They estimate that the actual process of repairing land and rebuilding houses will take two to three years.

Suburb-wide remediation plans are being developed in conjunction with local councils, particularly in regard to restoring utilities such as sewerage.  

We will be working with the EQC where appropriate to expedite the process as best we can.

Will my house have to be demolished so my land can be fixed?

A number of options are still being explored to establish the best solution to remediate damaged land.  It is possible that some houses may need to be demolished, however this will only be known once the damage has been fully assessed.  
The EQC and Insurers will need to coordinate this together with Councils and other groups over the next months. We will keep you fully informed throughout the process and ensure you understand what your options are.

Temporary Accommodation

Who pays for temporary accommodation?

AA Insurance will cover the reasonable cost of temporary accommodation while your home cannot be lived in for up to 12 months.  The 12 months do not need to be taken continuously and can be used at any time during the repair/rebuild process whilst the home is uninhabitable.

What do I do about temporary accommodation after 12 months if my home still isn’t repaired or rebuilt?

AA Insurance/ will cover the reasonable cost of temporary accommodation while your home cannot be lived in for up to 12 months.  

Once a plan for your property is worked out by the EQC, there will be a better understanding of what options exist.  There are some grants and assistance available and we can discuss this closer to the time.  A Government Helpline has also been set up on 0800 779 997.

EQC questions

For questions relating to what is covered by the EQC, land damage, EQC excesses, EQC reports or EQC claims please check the EQC’s website www.eqc.govt.nz or by calling 0800 326 243 (0800 DAMAGE).

EQC Stage Two report

The Stage Two Report is based on a suburb-by-suburb engineering assessment into the nature and extent of the land damage that was caused by the earthquake.

The Report also identifies the land repair strategies for each suburb and areas most affected by land damage.  Affected properties are categorised into three zones; A, B, C or are ‘unmapped’.  

All homeowners with a claim lodged by 5 November 2010 have been sent a letter confirming if they are within zone A, B or C, or if they are yet to be mapped.

Zone A

Zone A has no land damage and therefore the land does not need fixing.  According to the EQC, there is shaking damage to buildings in this zone, but there is no visible evidence of liquefaction.  Once your EQC assessment has been completed, we will be able to begin the process of repairing or rebuilding your home.

The EQC have told me I’m in ‘Zone A’ but I have damage to my land, what do I do?

We’ll make a note of what zone they have identified your property to be in, however, you will need to contact the EQC directly to have them reassess your property.

If you have land damage which they have not assessed, please send an email to claims@eqc.govt.nz with the subject line of “Unassessed Land Damage” and add your EQC claim number or call them on 0800 326 243.

When can you start the repairs?

Mainzeal will be in contact with you by mid February to confirm their next steps, which will likely involve completing a more detailed Scope of Works and quotes.  Once Mainzeal have this information, the repairs will be able to begin.  In terms of an actual timeframe, Mainzeal may be able to provide you a more specific timeframe once the Scope of Works and quotes are complete.

EQC are mindful that aftershocks can still cause further damage and are recommending that, if possible, everyone wait until the aftershocks subside below 4.0 magnitude.

Zone B

Zone B needs relatively simple repairs to the land involving filling the cracks and compacting the ground surface.  Once your EQC assessment has been completed, and your land has been repaired, we will be able to begin the process of repairing or rebuilding your home.

When can you start the repairs?

Mainzeal will be in contact with you by mid February to organise the next steps.  What they are likely to do is complete a detailed Scope of Works and quotes on the cost of repair but this depends on what exactly is required and will help them to prioritise work.  As long as the repairs to your land do not inhibit our ability to repair your home, the repairs should be able to start soon after the Scope of Works and quotes are completed.

EQC are mindful that aftershocks can still cause further damage and are recommending that, if possible, everyone wait until the aftershocks subside below 4.0 magnitude.

EQC are mindful that aftershocks can still cause further damage and are recommending that, if possible, everyone wait till the aftershocks subside below 4.0 magnitude.

Zone C

Zone C requires a repair strategy involving local councils, the EQC, and insurance companies.  The repairing of land and rebuilding of homes will be staged as part of a coordinated land repair strategy.  As land is repaired, we will be able to begin the process of reinstating your home.  

Repairs and rebuilding within this zone may take some time.

How will you know when I can rebuild?

We will receive sign-off that the land repairs have been completed.  This will give us permission to then progress with your claim and start the required repair/rebuilding work.

Unmapped

Properties that are not in suburbs identified as being most affected by land damage have not been mapped by EQC geotechnical engineers.  Most of these properties in the unmapped areas will likely be categorised as Zone A.  As such, once your EQC assessment has been completed, we will be able to begin the process of repairing or rebuilding your home.

When will you know what Zone I’m in?

The EQC have advised that all mapping should be completed by the beginning of March.

When can you start repairing my home?

As soon as we know what zone the EQC places your property in we will be in a better position to know how we can proceed with your claim.  

In the meantime we will progress your claim as far as we can by having MWH Mainzeal complete a detailed Scope of Works and where possible organise quotes so that as soon as we are given the okay to proceed, we can start repairs.

When will you repair my home?

We have handed your file information over to Mainzeal and they will be contacting you to advise you what they need to do next.  This may involve completing a more details Scope of Works and getting quotes, but this depends on what exactly is required.  This will also help to prioritise work.

EQC are mindful that aftershocks can still cause further damage and are recommending that, if possible, everyone wait till the aftershocks subside below 4.0 magnitude.

Your insurance cover

Do I still need to keep paying my premium?

It is important that you continue to keep your insurance cover in place.  If you choose to cancel your home or contents insurance, you need to understand what this means for your insurance cover.
Please consider the following before you make a decision about cancelling your insurance:

Home:
•    Any undamaged part of your home may still require protection against further loss or damage, prior to and during the rebuild process.
•    The Land (beneath and within eight metres of your home) is covered by EQC. If you decide to cancel your home insurance, EQC cannot accept future claims for damage to the land e.g. if an event occurred prior to the rebuild work being undertaken.  This may mean that the rebuild will be delayed until you have carried out repairs to the land (at your expense).    
•    A property owner is responsible for safety at the property, and therefore liable for accidental damage to any third party property. 

Contents:
•    Insurance cover is still needed for contents that:
o    are undamaged.
o    are removed from your home and is in storage while the repairs/rebuild work is undertaken.
o    you currently have with you and/or any new items you purchase.
o    you are responsible for (that may otherwise be uninsured) while living in alternative accommodation.

Your contents insurance provides you with personal liability protection against losses or damage you might cause to someone else’s property.  This is important for you to have, especially whilst in alternative accommodation.

If you would like to discuss your options further, please don’t hesitate to contact us.  

General

I haven’t lodged a claim yet - can I lodge it now?

The EQC deadline for lodging claims relating to the earthquake on 4 September 2010 was 4 December 2010.  Now that this deadline has passed, no new claims relating to this event will be accepted by the EQC.  This means that all insurance companies are now also unable to accept home and contents claims for the earthquake.    
If you lodged a claim with the EQC before 4 December 2010 but not with us (or it is for something they don’t cover e.g. a vehicle claim), you can still lodge this with us.  

Since the earthquake, some cracks in our house have got bigger.  Is this normal?

It is part of the settling process and is due to movement of water tables in the ground below your property.  As this occurs, the ground may shrink or move causing movement within your house.  Over time, the movement will diminish.

Can we wait until the aftershocks have finished before repairs to our house start?

Aftershocks have the potential to cause further damage and the EQC has recommended that, if possible, repairs should hold off until aftershocks subside to (and remain below) a magnitude of 4.0.

However, aftershocks are unpredictable and delaying repairs for this reason may not be practical.  We will consider each case on an individual basis and discuss any implications of delays with you.