Gestión administrativa

MBIE opened a wage subsidy fund for small business employers to be able to continue to pay their employees. The Farm C farmers were able to take advantage of this fund. It helped fill some of the gap left by not having an income source and business

interruption insurance to replace it. Since the earthquake, they have taken out business interruption insurance.

Insurance came into effect immediately. Two of the farmers had spoken with their insurance agents and companies on the day of the earthquake. The third had an on-farm visit within a week. This speed did not last past Christmas. One Farm B farmer

described their insurance’s early involvement:

“Yeah and the response from the 14th of November to, I recon, about the 14th of December, for about a

month, maybe for a few days after that was…you could not fault it. There was nothing they weren’t trying to

help with. If we can get that person there to find out what- if you get that done, send us an invoice, but all of a sudden, the rules changed and it went from let’s get this working and moving to we need to send out Inovo,

which is the company that does the scoping for them.”

A number of lessons about insurance coverage were garnered during this time. One Farm A farmer commented:

“The insurance for farm houses is geared towards urban water supply, where you’ve got a supply of water at your gate. And they will cover you for 50 metres or so within your house boundary.”

On the other hand, a Farm B farmer found that some parts of their system were unexpectedly covered under insurance.

“We’ve discovered that a water tank comes under an unspecified farm building. For my policy, we could have

a claim for 5,000 dollars per unspecified building to a maximum of six claims. So, you could have up to 30,000 dollars. There are things like that that are in your fine print, that to be honest I haven’t really read through it,

but they triggered.”

In mid-December 2016, the insurer closed a deal with private insurers to manage processing for earthquake claims covered by insurer (EQC 2016). The goal of this agreement was to simply speed the insurance process for claimants. The insurer’s earthquake insurance claims window closed mid-February. Most of the claimants have

114

been addressed, but not everything had been resolved as of January 2018. Farm A rejected the insurer’s initial offer. The farmer described their experience with the insurer:

Farmer A: “This earthquake is a little bit different to the Christchurch earthquake where [Insurer] got the insurance companies to act on their behalf to do all the building assessments and stuff like that. So, [Insurer]

haven’t been on the coal faces this earthquake. It’s been subcontracted to [Insurer] and [Insurer] companies like that. So, [Insurer] when we have dealt with them have been really prompt and on site. The likes of

[Neighbour]’s retaining wall and damage to his land. They were very quick about that. And they were quick

over there [the shearers’quarters’ direction] too, it’s just that I think they were wrong. And they willsay ‘Aw, it’s not impending doom’ or what’s that the term or phrase.”

Researcher: “Imminent Risk.”

Farmer A: “Imminent Risk. And I’m like, ‘Aw well doesn’t really matter because it’s on a fault rupture.’ The

hazards, they are two different things, but they cover more ground. The landslides giving me the shits more

that the fault ruptures. But also, it’s just not going to neatly follow that fault and then that fault there. It could be once that bit goes, that bit decides to go as well.”

During the start of the short-term recovery period, insurance companies began to be impacted by the reaction of their reinsurers. A farmer described this transition:

"When they were starting to see the size of the event. The reinsurers were starting to get involved and as soon

as the reinsurers got involved, all of a sudden, the breaks went on and that was it. ‘Ah, no sorry. We can’t do that now.’ Like, ‘We’ve got so-and-so coming up to fix this, do emergency repairs, not a problem, just send in

the invoice when you’ve got it fixed.’ And reinsurers were starting to get some exposure to it and all of a sudden, it’s like there’s no more of that. You have to be assessed by [Surveying Company] was the company

that they used. They have to come up and assess it and there’s all this reporting that has to go through before

anything would be. And so even your assessor you’d ring him up, that was on your case, and say ‘We’re at a point where we fix this to keep going.’ And he’d just say, ‘My hands are tied. I’m not allowed to do anything

unless scoping team signs off on it.’”

Insurance claim resolution is a gradual process. Claims for infrastructure covered under the same policy may be settled at different rates.

The extended process allows for more opportunities for slowing the process further as new people are brought in. One Farm A farmer discussed slowdown:

Farmer A: “We’ve had a number of staff members from [Insurer] leave or move on. We had our own broker leaver her job. We haven’t actually dealt with one person all the way through. That’s quite frustrating because

you feel as though you’re actually making some progress and then they leave. They go on holiday. I guess it’s the human factor that people’s lives change and you can’t expect people to keep a job just because your

insurance claim is-. But it just creates- there is still a lot of pragmatic conversations that are had and I guess they form positions that they generally sway either way on. And when they start to sway a certain way they act quite quickly. But they seemed to be going back to these new people that all of a sudden they’ve got to get

a heads up.”

Researcher: “You’re potentially educating a new person?”

Farmer A: “Yeah, it feels like that.”

On Farm B, the farmers had nearly a year long argument with their insurers over the coverage and payment of their policies on their woolshed and homestead. Their

woolshed claim was settled by April. A major part of their insurance claim struggle was over the coverage of the woolshed’s power source. There was disagreement about

115

whether or not the land damage that made the power unusable was covered by insurance. Also. The repair estimates from the insurance company’s scoping company and insurance company themselves were not matching. Once the insurance claim settled, the power companies were quick to fix the line.

Farm B’s homestead claim took longer. The homestead was not uninhabitable due to damaged sustained, but because a large historic landslide was declared an imminent risk. The local council had refused to issue a building consent for repairs. Numerous surveying companies had surveyed and written up reports declaring imminent risk. The insurance continued to offer repair in the same place. The farmer described the back and forth between various engineering companies, geologists, insurance and the council:

"So, we had all these reports back and in the meantime, to get [Engineering Consultant 1] to come back we had, [UC geologist] had put us in contact with [Engineering Consultant 2] and we had a guy that we were working with there that, his name slipped off the top of my head. But anyway, [UC geologist] had said to us, [Engineering Geologist]. They said to us, ‘Look we’ll put you in touch with this guy and we’ll get things rolling.

So, we had another report that came back from [Engineering Consultant 2] before the last [Engineering Consultant 1] one that said, ‘No, we believe there is imminent risk.’ So, as soon as we sent that into [Insurer]

they started to really get things rolling and that’s when they got [Engineering Consultant 1] back. And there

was obviously a lot of stuff going on because that’s when that [Engineering Geologist] came out and said,

‘Well, yeah.’ So, in the end we had two reports. We had the original [The Government Department] one that said not to go into the area. Then we had the [Engineering Consultant 2]’s one that said Nah. They had to state that there was imminent risk, which they did. And then we had [Engineering Consultant 1] come back up under [Insurer] and said yup this is imminent risk. So, we had all these reports and they all went to the private

insurer ‘cause by this time they were saying Ah yeah send them in send them in ‘cause this will help us with

our findings, so we sent them all in and the offer came back exactly the same. They said no we don’t believe there’s any risk. So, we will repair you in the same location. In the meantime, the council won’t give a consent

for repairs because you have a building consent it has to have a fifty-year lifespan and no one would put their name on a document to say we believe that if we repair this house on this location that for the next fifty years someone will be safe in that location. Because as [UC geologist] had pointed out quite often you’ll get these big

ruptures and I think he used the Napier earthquake as the prime location. They had a massive rupture come down, was it twenty years, quite a long period after they had a massive landslide come down. And that was a result of that earthquake, it was quite a long time. No one could come up there and say this moment, next

month, it depends on weather conditions. So, we get another aftershock… "

Their claims were settled in November 2017. They credit their lawyers with being a major force in reaching a satisfactory resolution.