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Archived Updates

2011 Updates

December 2011 EQC claims cap and event apportionment
2011 MAS temporary accommodation
2011 Initial response repair and rebuild information
2011 Initial response temporary accommodation information
2011 Initial response claims information
2011 Initial response business claims information

 

EQC claims cap and event apportionment

December 2011

In September 2011 the High Court ruled that EQC cover is continuous. This means that EQC insurance covers up to $100,000 per event on dwellings and up to $20,000 per event on contents, for the period that insurance cover is in place. EQC have since been required to give due consideration to the suitable apportionment of all EQC claims relating to the earthquake that caused the damage.

How does this affect my claim?

If MAS has notified you that your property has incurred damage considered over the EQC cap and repairable, your architect or loss adjuster should continue scoping repairs to your property.

Your architect or loss adjuster has been asked to provide MAS with an estimate of the damage attributed to each event. EQC will review each claim to determine damage apportionment, confirm whether each claim is under-cap or over-cap, and notify you in due course. Please contact MAS when you receive this confirmation and we will update your MAS claim accordingly.

You and your architect or loss adjuster must demonstrate that at least one earthquake caused damage assessed as over the EQC cap for your repairs to be managed by Beca or your loss adjuster.

Following review of your claim, if the damage to your property is assessed as under-cap (even if the damages from all earthquakes total a sum over the cap per claimed event) then your repairs will be managed by EQC Fletchers. You are also entitled to opt out of the EQC Fletchers programme, take a cash settlement and manage the repairs yourself. Details are available at www.eqr.co.nz.

If MAS has notified you that your property is over-cap and beyond repair (requiring a rebuild), in general the status of your claim with MAS will remain unchanged. EQC will still be required to review the damage apportionment per claimed event in order to settle your claim(s).

How is MAS assisting with this process?

We meet with EQC on a regular basis to review claims warranting further discussion on the extent of the damage and claim apportionment. MAS requires an assessment of damage per event from your architect or loss adjuster to share with EQC in this process. MAS are committed to keeping you informed on the progress of your claim; however the EQC process is external to the MAS process and as such is outside our control.

What should I do if EQC want to inspect (or re-inspect) my property – Should I let them?

Yes, your first insurer is EQC and as such you should always facilitate their assessment of your property, and the information you provide to EQC should be specific and accurate.

Following inspection, EQC have advised me that my claim(s) with them is not over-cap

If MAS has advised you previously that you have an over-cap claim, this was based on the information available at the time of our inspection. Proceedings between EQC and the Insurance Council have affected changes in some cases that are now considered under-cap due to event apportionment.

Fletchers have notified me that they intend to commence repairs, but MAS have previously told me I’m over-cap

If MAS have previously advised that you have an over-cap claim, please advise Fletchers that you would like to clarify this request with your Insurer prior to proceeding. This will allow MAS to confirm the event apportionment that we have from previous inspections.

CEO of Canterbury DHB awarded by NZMA

MAS would like to recognise David Meates, CEO of the Canterbury District Health Board, who recently received the New Zealand Medical Association's highest standing award for the Board's response to the February earthquake.

The NZMA Chair's Award goes to an individual or organisation that has made a substantial contribution to the health of New Zealanders, either throughout the current year or over a given period of time. Read more here.

Claims progress

Although the EQC cap and apportionment process is ongoing, as of 1 December, 430 of 473 Beca managed properties have been categorised, of which there are:

  • 59 properties under-cap
  • 263 reinstatement properties
  • 108 total rebuild properties
  • 32 claims cash settled

MAS has 44 repairs underway for driveways and fences with Artworks Landscaping where either the house repair is under-cap or there is no other damage. Where the house is over- cap, repairs will be part of the reinstatement managed by Beca or your loss adjuster.

We hope that this newsletter has provided some useful information for you.

If you have any other questions or need more information, please contact us on 0800 800 627 or e-mail us at info@mas.co.nz.

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MAS Temporary Accommodation

2011

Members with current or settled claims for earthquake damage to their property that has been assessed as under-cap by the Earthquake Commission (EQC) may be/have been required to vacate their homes during repairs. In these circumstances you may incur/have incurred expenses for alternative accommodation.

We have previously advised Members who have already (or may in future) incur such costs that these are not covered by their MAS policy. We appreciate this is not what Members expected and is not in line with what other providers have been able to offer. This is not a satisfactory situation from your point of view or ours.

As a result we have looked carefully at how we can assist you. A recent survey of Members has been very helpful in determining what would be a meaningful contribution toward the costs incurred by Members who are forced to leave their homes.

Effective immediately, MAS will provide eligible Members reimbursement of up to $1,000 per week for a maximum period of eight weeks. Reimbursable expenses include:

  • Actual and reasonable rental costs for alternative accommodation for you and your dependants.
  • Additional and reasonable boarding costs for domestic pets.
  • Additional and reasonable storage and transit costs.
  • If your property is a rental property, and your tenants are required to vacate, MAS will cover your actual loss of rent up to the maximum of $1,000 per week for a maximum period of eight weeks.

We appreciate that some Members may choose/have chosen to live with friends or relatives during repairs. We will consider a claim for additional actual and reasonable costs incurred during your stay by you, or your host on your behalf, on a case-by-case basis.

What happens next? Please complete a Temporary Accommodation Claim Form and return a scanned copy to us along with scanned copies of your supporting documentation by email to claims@mas.co.nz as soon as possible. Alternatively you can post this documentation to:

MAS Attn: Claims PO Box 13042 Johnsonville 6440 Wellington

More detailed information is available in our frequently asked questions sheet. If you have any additional questions, please call us on 0800 800 627 or email info@mas.co.nz.

*An under-cap claim is for earthquake damage to your home that has been assessed by EQC as under $100,000 + GST per earthquake event.

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Initial response repair and rebuild

Repair and rebuild progress We have commenced rebuilding and repairs to properties in the green zone.

If your land is in the white or orange zones you may have to wait for a government decision about your land before we can proceed with any repair or rebuild work. We are looking at these claims on a case by case basis. If you have any questions regarding the commencement of rebuilding or repairs please contact us at info@mas.co.nz.

When will my rebuild / repair take place? As you can appreciate the high volume of claims in the Canterbury region means that we have to prioritise Members’ claims.

Currently we are prioritising claims made directly following the September earthquake, as well as Members in the red residential zone. This is to ensure Members have the information they need to decide which government payment option they want to accept. See www.cera.govt.nz/land-information for more information.

Our next priority will follow CERA’s reclassification of land. If there are extenuating circumstances, we will look at the claim on its individual merits. 

Any remaining claims will be settled in date order of when the claim was lodged.

How will my rebuild be managed?

In January MAS appointed Beca to oversee the management of the MAS earthquake reinstatement works, both for commercial and residential properties.

Structural engineering inspections of each property are underway to determine if the claim will be managed by the EQC or MAS. Each property being categorised as having damage valued at either: 

  • Under the $100,000 EQC cap (for domestic); or
  • Over the EQC cap, therefore having a claim with MAS (i.e. all residential properties with claims valued at greater than $100,000 damage and all commercial properties). 

Each property that has a claim with MAS has been further assessed as being able to be repaired (reinstatement) or requiring a total rebuild. There are a number of properties that sit between these categories, but these have been clearly identified as such.

Beca can help facilitate the appointment of an architect to act as a lead consultant in the repair / rebuild of your property. Members will be responsible for nominating the architect and entering into a contract with them. The architect will then contact you regarding setting up a team of contractors to carry out repair works to your dwelling. Please let us know if you have preferred suppliers for these services. Send your request to masclaims@beca.com and include your name, address and a daytime contact number.

Under the terms of your policy, MAS will fund the cost of rebuilding the property to substantially the same using modern materials and current building regulations. MAS can provide Contract Works Insurance cover for rebuilds.

Our earthquake domestic claims process chart gives you a detailed picture of how the whole claims process works from start to finish. You can also view our relationship structure for a diagram illustrating the relationship(s) between yourself and those involved in your repair / rebuild.

 

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Initial Response - Temporary Accommodation Information

2011

If your house is uninhabitable due to loss or damage for which a MAS claim is accepted, we will pay the costs of alternative accommodation during the reasonable period of reinstatement, including the costs of boarding cats and dogs. 

The cover for temporary accommodation is an amount up to a maximum of $25,000 or 12 months, whichever comes first. 

This cover can also be used to cover any added costs of staying in your home, for example. hire of generators, portaloos, special heating arrangements for winter.

Government accommodation assistance

The government assistance programme for temporary accommodation will assist Members who have exhausted their entitlement with MAS. Singles may be eligible for a weekly subsidy of $180 and families may be eligible for up to $330 depending on the size of the household. This scheme will be in place until 17 February 2013. You can investigate your entitlement at www.quakeaccommodation.govt.nz

Before you can access financial assistance you will need us to confirm that your policy entitlement has been used up. Please contact info@mas.co.nz to request a letter confirming this from us.

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Initial response claims information

Contents claims

MAS’s cover provides for full replacement of the cost of replacing or restoring your contents destroyed or damaged in the earthquake. MAS will replace your contents with the nearest equivalent item. 

There are two types of MAS contents claims:

  • Damage not covered by EQC, for example, artworks, collectables, that is settled by MAS.
  • Damage to contents that is greater than $20,000.   EQC pays $20,000 minus 1% excess (+ GST).  MAS will pay the remainder including the replacement of items not covered by EQC. 

We’ve been working with EQC so that Members don’t have to deal directly with them for the first $20,000 of your contents claim. If you have a claim over this amount, lodge it with us, and we will settle directly with you and we will then let the EQC know that they can pay you the $20,000 directly. 

Making a contents claim

If you have not already done so please lodge your claim with MAS who will also complete your EQC claim on your behalf. Claim forms are available by phoning 0800 800 627, emailing info@mas.co.nz or from www.mas.co.nz

To assist us to progress your claim please include as much information as you can and where possible receipts, warranties, valuations or manuals for major household items. This will help us to settle your claim as quickly as possible. Photographs will also be useful.

House claims There are a number of complexities involved and less opportunity to find quick ways to settle house claims. In particular, liquefaction and land stability complicates the resolution of house claims in some instances. Building consents will only be issued after land stability issues have been addressed.

The government has classified affected land in Christchurch as green, orange, red or white, as below:

  • Green – is suitable for repair and rebuild
  • Orange – engineers need to undertake further investigation
  • Red – land repair would be prolonged and uneconomic
  • White – mapping of this land is still underway.

See repair / rebuild information for more details. See www.landcheck.org.nz to check on the status of your land.

There are two types of house damage which will involve MAS:

Damage not covered by EQC, for example, paths, driveways, fences, outside pools.  

  • You can either get quotes to repair this damage and we will arrange to have the work completed or we can arrange a contractor to do this for you. 
  • Indoor pools are covered by the EQC.

Building damage greater than $100,000.

  • EQC settles your claim and pays the first $100,000 minus 1% excess + GST. 
  • MAS will pay the remainder including items not covered by EQC.   

How your house cover works  MAS covers the cost of rebuilding or restoring the house to a condition substantially the same as new, so far as modern materials allow, and including any additional costs which may be necessary to comply with the current building code. 

See the Earthquake claims process for what happens if your house is economical to repair. If your house is not economical to repair the following scenarios apply:

  • Scenario one – You wish to rebuild in the same style and design as your existing home (but using modern standards and materials).  MAS will offer a cash settlement to rebuild your home or, if you prefer, MAS will undertake a tender process and select the construction team to manage your rebuild. 
  • Scenario two – You wish to rebuild your home to a different design.  MAS will pay a cash settlement to the value of rebuilding the existing dwelling.
  • Scenario three – You do not wish to rebuild.  MAS will arrange for your house to be valued and we will offer you a cash settlement for this amount. The amount will be different than the amount if you had decided to rebuild.  This is because you will be covered for an indemnity value (pre-damaged value of the existing property) which will be less than what the replacement value would cost. You will retain ownership of the section.

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Initial Response Business Claims Information

2011

How your building cover works

MAS covers the cost of restoring the building to a condition ‘substantially the same’ as its condition when new, based on current methods and materials. 

We also cover: 

  • Demolition costs
  • Professional fees
  • Temporary security 
  • Added compliance costs. 

An excess of 2.5% of the loss, with a minimum of $2,500, applies to these claims. The sum insured for the building is the maximum amount that can be paid, regardless of whether this is for repair or complete reinstatement.

Additionally:

  • Demolition of any building may require local authority consent. 
  • Land stability may need to be checked with a geotechnical report. This is one of the most significant issues related to these earthquakes. Decisions need to be made at a macro level about areas of land, before decisions can be made about individual sites.
  • Widespread liquefaction damage may result in individual sections and/or areas of land being retired.   

Making a building claim As there is no EQC cover, all your dealings will be with MAS. If you have not yet registered a claim with us, please do so as soon as possible. Phone 0800 800 627 or email info@mas.co.nz. On receiving the claim MAS will appoint an assessor if required.

There are two possible outcomes for your building claim: 

  • The building is economical to repair
  • Your business building is not economical to repair

Your business building is economical to repair: 

  • Scenario one:
    • Repairs are minor, i.e. less than $100,000.
    • Members may prefer to engage their own preferred contractors.
    • Plans, specifications and prices are agreed.
    • Any required building consents will be obtained by the contractor.
    • Remedial work is authorised by MAS.
    • Members may prefer MAS to arrange contractors. 
  • Scenario two:
    • Repairs are major, i.e. over $100,000.
    • MAS will engage Beca to provide engineering/specialist advice.
    • Members may prefer to engage their own preferred contractors.
    • Plans, specifications and prices are agreed with the appointed assessor.
    • Required building consents will be obtained in consultation with Beca and MAS.
    • Remedial work is authorised by MAS.   

Your building is not economical to repair: 

  • Scenario one:
    • You wish to rebuild ‘substantially the same’ property at the same location.
    • MAS will offer a cash settlement to rebuild or, if you prefer, MAS will undertake a tender process and select the construction team to manage your rebuild. 
    • The sum insured represents the maximum amount payable. 
  • Scenario two:
    • You wish to rebuild at another location.
    • If you would prefer to rebuild at another location, MAS will pay a cash settlement up to the cost of reinstatement at the original site.
    • The maximum payment is also limited to the sum insured. 
  • Scenario three:
    • You do not wish to rebuild. 
    • MAS will pay the market value of the building as assessed by a registered valuer. 
    • Market value means the depreciated second hand value at the time of the loss, taking into account age, condition and wear and tear.
    • This also includes costs of demolition and removal of any debris. You will retain ownership of the section.   

Contents claims MAS’s cover provides for full replacement of most business contents destroyed or damaged in the earthquake. Replacement is for contents that are on the current asset register, or depreciation schedule, or less than 10 years old. 

MAS will cover the cost of repairing items (where economical) or the cost of replacing the item. We will replace your contents with the nearest equivalent item. 

Making a contents claim

As there is no EQC cover, all your dealings will be with MAS.  If you have not already registered a claim with us, please complete a claim form.  These are available by phoning 0800 800 627, emailing info@mas.co.nz or from www.mas.co.nz. 

To assist us to progress your claim, please include as much information as you can and, where possible, a copy of your asset register and depreciation schedule. 

MAS settles claims on the basis of the cost of equivalent replacement items. 

There are two possible outcomes for your business contents claims 

  • Scenario one:
    • Items are economical to repair.  Members should contact their equipment suppliers and arrange for the items to be inspected.
    • Suppliers should ring MAS with repair quotes for authorisation.
    • Repair work is authorised by MAS. 
  • Scenario two:
    • Items are not economical to repair.
    • Members should contact and arrange for replacement equipment purchase quotes to be provided to MAS.
    • MAS authorises replacement equipment.
    • Where appropriate, MAS will be entitled to the proceeds of any salvage.

Business Interruption disaster cover

Disaster cover is an elective cover and not all Members will have this. 

Business Interruption covers loss of profit where this results from: 

  • Damage to your property. 
  • Lack of access. 
  • Loss of essential services.

How is your business interruption claim calculated? 

  • MAS compares trading after earthquake to the same period in the previous year. 
  • An allowance for trading trends is included. 
  • The claim is limited to the insured ‘indemnity’ period up to the sum insured. 

There are several possible scenarios: 

  • Scenario one:
    • You have not suffered any loss or damage and are able to provide ongoing services to patients but it appears turnover is down due to lower patient demand. 
    • A loss of this type is generally referred to as a ‘loss of attraction’ and is not covered under an insurance policy. 
  • Scenario two:
    • Your business is in the red zone or has been badly damaged and you are unable to operate from those premises. 
    • MAS’s business partner, Grant Thornton, will work with Members to quantify their loss during the period that Members are unable to access or use their premises. 
    • Depending on the condition of the premises, scenario three (following) may also apply. 
  • Scenario three:
    • You have been able to relocate to alternative premises. 
    • MAS will work with Grant Thornton to quantify Members’ losses for the period that you incur additional costs (above those that would have been incurred in your original premises).

Business advice

Business advice can be useful at a time like this when a number of decisions have to be made. For instance: 

  • Have you considered sharing premises? 
  • Have you communicated to patients and customers what’s happening with your business? 

If you’d like to talk to someone about your options please phone us on 0800 800 627 and ask to speak to our Business Advisory Service (BAS). Alternatively you can email business@medicals.co.nz or access our online business support service at www.healthypractice.co.nz. You can contact BAS to arrange access to HealthyPractice®.

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