Having been refused insurance can leave it difficult to find cover with another provider. Fortunately there are insurers who may provide cover, albeit at a higher premium.
Regrettably for Christchurch City Council in New Zealand, this doesn’t seem to be the case.
Their insurance policy which was provided by Civic Assurance expired on Thursday afternoon (New Zealand time) and now Civic Assurance, or any other company, are not prepared to provide cover following the devastating earthquakes to hit the area in recent months.
Christchurch City Council alone needs material damage insurance for $2.8 billion worth of above ground assets including council buildings, libraries and the AMI Stadium and below ground assets, such as sewerage. This is following warnings of the possibility of aftershocks in the coming days.
Christchurch was hit with a magnitude 5.5 earthquake, followed by a magnitude 6 earthquake, over a distance of 10kms, and 11kms deep. 40 people were left injured in the aftermath, 2 seriously injured, many from falling building material.
Over 20,000 homes went without power, although the initial quake knocked out power to an estimated 56,000 homes.
These quakes are the latest in a series of dozens of aftershocks to hit after the devastating February 22 earthquake, where 182 people died, and a damaging magnitude 7.1 earthquake last September. The February 22 quake measured magnitude 6.3 and left 100,000 homes damaged - 10,000 beyond repair.
Christchurch mayor Bob Parker advises that they have been looking towards insurers in Europe. However nobody is prepared to provide cover for Christchurch as the risk factor following continued tremors is too high.
Parker advises that they have been able to secure fire insurance, but are finding quake insurance unobtainable at the moment.
Christchurch’s finance and corporate services director Wayne Thomas says without insurance the cost of repairs for any future damage to the regional council's assets could be paid for by several generations of ratepayers.
By Ben Malkin
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