Christchurch residents who have been caught up in disputes with their insurers say the Labour Party's plan for an earthquake court will even the playing-field for homeowners.
Empty house in the red zone, Christchurch. Photo: RNZ / Diego Opatowski
Labour Party leader David Cunliffe has announced a Labour government would introduce a special earthquake court, for claims of up to $1 million.
Some in Christchurch have said the move may be just the thing needed to even the playing field against the deep pockets of the insurance companies.
Christchurch city councillor Ali Jones is one of many in the city still fighting her insurance company over the repair of her home almost four years after the quakes.
She said the insurance industry had failed spectacularly in Christchurch, and many people got nowhere with their claims until they resorted to legal action.
"To have a system available where people can take on the insurance sector and address this imbalance of power in some way to the little guy's advantage, then I say bring it on."
Last year the High Court ruled insurance company Tower must pay Valerie O'Loughlin and her husband the full replacement value on their red zoned home, not just the $197,000 offered for repairs.
Mrs O'Loughlin said taking on a costly court case was hugely stressful, and an earthquake court where all costs were covered by the Crown and the insurers would be a great idea.
She said she is sure it would make a big difference those who won't even contemplate going to court because of the cost.
Brent Cairns, spokesperson for Wecan, an advocacy group for people with quake-damaged homes, said residents were on the back foot when it came to taking on insurance companies, and an earthquake court would even things out.
Mr Cairns said it was an indictment of the insurance industry that people have had to wait so long for the claims to be fixed in Canterbury.
Labour said it would recoup costs for the court from insurance companies and the Earthquake Commission as a levy.
Another Christchurch resident, Cam Preston, who has also been battling his insurance company, said he feared the the court would just end up with lawyers and experts earning lots more money, and the public paying the cost.
He said ultimately the money will come from people's back pockets through increased EQC levies or private insurance prices.
Mr Preston said what he'd like to see is a top down review of the whole insurance industry, as he said the Christchurch case showed that the present system did not work when a catastrophe hit.
Insurance Council chief executive Tim Grafton said the proposal set a bad precedent, as it would be the state basically requiring the industry to pay people to sue it. He said the only winners would be the lawyers.