Publications
Annual Report
2004-2005
Statement of Intent - Performance Measures Report
Following is a list of the Commission’s objectives and performance measures from its Statement of Intent and indication of progress during the year.
- Claims Handling and Catastrophe Response
- Management of the Natural Disaster Fund
- Administration of the Insurance Scheme
- Public Education
- Research and its Evaluation
- Promotion of EQC and its role
- Policy and Advice
- Financial Management
- Equal Employment Opportunity
Claims Handling and Catastrophe Response
All claims on the Commission are completed to the standards set within the Catastrophe Response Programme.
Performance measurements
- Ensure the levels set in all service level agreements with service providers have been met, in times of normal and abnormal activity.
Achieved. - Meet the requirements of the Catastrophe Response Programme in terms of contract reviews, manual revisions and exercises.
Achieved. Fourteen training activities and exercises undertaken. Three real operations conducted. - Work with Civil Defence and Emergency Management Groups as they are set up to help meet joint objectives related to managing repairs and reconstruction of housing.
Achieved. Ten activities were carried out with the Ministry of Civil Defence and Emergency Management and/or local authority CDEMG organisations.
Management of the Natural Disaster Fund
The performance of investment and protection activities is in accordance with best practice.
Performance measurements
- Diversify investments to include an allocation to global equities in accordance with the terms of the Minister’s directive for the investment of the Fund.
Achieved. - Improve the real value of the Fund (excluding cash held as working capital) over the medium-term utilising a mixture of assets designed to:
- Achieve an average rate of return of at least 1% p.a. over the Crown’s cost of borrowing over a rolling 10-year period;
- Subject the Fund to no more than 1 chance in 3 that over any 10-year period the annual rate of return will be less than the Crown’s cost of borrowing.
- Achieve an average rate of return of at least 1% p.a. over the Crown’s cost of borrowing over a rolling 10-year period;
- Meet or exceed the performance benchmarks set by the board for individual investment classes and maintain the safe-keeping of assets in accordance with best practice.
All individual investment classes except actively managed international equities met or exceeded performance benchmarks. Safe-keeping of assets was done in accordance with best practice. - Ensure cash inflows from investments, reinsurances and other financial protection policies are sufficient to meet all claims and other liabilities under foreseeable circumstances.
Achieved. - Meet best practice for the transfer of insurance risk and financial protection of the Fund, which:
- With the Fund’s investment strategy, provides optimal cost/benefit and risk management;
- Implements a reinsurance programme providing sustainability over time against reasonably foreseeable events;
- Provides flexibility in the reinsurance agreement terms and conditions should the Crown determine a different risk profile under the natural disaster insurance scheme in the future;
- Controls the risk to the Commission of default amongst reinsurers/capital markets.
- With the Fund’s investment strategy, provides optimal cost/benefit and risk management;
Administration of the Insurance Scheme
Fair and consistent administration of the scheme, including efficient verification of insurance coverage at the time of a claim.
Performance measurements
- Maintain a programme of physical checks and commercial audits which adequately verifies the integrity of the premium payments by insurance companies.
Achieved. - Complete the compilation of a database of insureds for statistical and analytical purposes, subject to insurance industry co-operation.
Insurance industry co-operation has not been achieved.
Public Education
Increased public awareness of the vulnerabilities and of steps that can be taken in the home to mitigate these; more households have taken precautions against damage from seismic events.
Performance measurements
- Work with Te Papa to ensure benefits of EQC’s sponsorship are maximised.
Achieved. - Work with other museums and educational institutions to achieve the outcome.
Achieved. - Research how awareness can be converted to action, including conducting trials and pilot schemes.
Achieved.
Research and its Evaluation
In order to build safer communities, the potential for damage caused by natural disasters as defined in the Earthquake Commission Act is reduced by:
- Providing support for learning activities and research projects;
- Generating, disseminating and applying knowledge;
- Developing relevant skills and community capability.
- Carry out the contestable grants round in 2005 in accordance with the approved timetable and procedures, and monitor for satisfactory project completion.
Process not yet completed. - Work with other users, providers and funders of research to ensure risk readiness, reduction, response and recovery activities are underpinned by the necessary knowledge to make them effective.
Achieved. - Carry out a review of GeoNet in accordance with the contract between EQC and the Institute of Geological & Nuclear Sciences.
Achieved. - Seek co-funding support for the Research Foundation for projects on Wellington’s earthquake risk and the hazards posed by volcanoes.
Achieved.
Promotion of EQC and its role
Increased knowledge and appreciation of EQC and its work in order to minimise confusion and misunderstandings which impede EQC’s operations.
Performance measurements
- Sustain the level of knowledge that EQC provides natural disaster insurance for homes, sections and house contents at 70% of those responding to EQC’s quarterly surveys.
Achieved 68%. - Sponsor public exhibits and other methods that enhance awareness of the roles of EQC and natural disaster matters, especially in parts of the country outside the “earthquake zone” (the central part of the country).
Achieved.
Policy and Advice
Crown policy with regard to its ownership and management of EQC is in accordance with cohesive and sound risk management principles and commensurate with the Crown’s overall responsibilities.
Performance measurements
- Establish the possibility of any of the changes recommended by EQC being brought about and implement any changes agreed to.
Achieved. Treasury has assured EQC its recommendations for reform of EQCover will be part of the review of the Earthquake Commission scheme. - Continue exploring, with Treasury, the concept of a sustainable Natural Disaster Fund and take any necessary action arising from any decisions made.
Achieved. Treasury has sent a draft report to the Minister, to EQC.
Financial Management
Financial reporting requirements are met and audit reviews show standards required by the board have been met; expenditure is within the budget approved by the board and Minister.
Performance measurement
- EQC financial statements meet standards required by the board, as attested by the Commission’s auditor.
Achieved.