National is welcoming the announcement of reforms to the EQC Act but is calling on the release of information around one that could be prohibitively expensive National’s EQC spokesperson Stuart Smith says.
“EQC cover is unique to anywhere else in the world and works very well.
“The reforms announced by Megan Woods today are largely a result of the review of the Act announced by the National Government last year.
“I am pleased that the Government has picked up most of the recommendations particularly raising the cap from $100,000 to $150, 000.
“However, extending the claim period from three months to two years will prove incredibly expensive and problematic.
“In a big event, it will confuse arguments of apportionment between reinsurers so the Minister needs to answer how different events are defined within that two year period.
“Following the February 2011 earthquake in Christchurch for example, there were literally thousands of aftershocks, many of which were considered separate events.
“This announcement will likely cause significant increases in costs to policyholders - I’d like to know from the Minister what advice she has had from Treasury about how much this will be - and whether Treasury supports the extension of the claims period.
“I am calling on the Minister to release Treasury’s advice on this matter,” Mr Smith says.