EQC Insurance
EQC’s Insurance
For EQC information about the Canterbury earthquake please refer to http://canterbury.eqc.govt.nz
What is EQCover?
EQCover is the natural disaster insurance available from the Earthquake Commission.
EQCover insures dwellings (including flats and holiday homes), personal property, and the land the dwellings are on.
It insures against earthquake, natural landslip, volcanic eruption, hydrothermal activity, tsunami; in the case of residential land, a storm or flood; or fire caused by any of these.
EQCover applies only to residential buildings that are insured against fire, a certain defined area of the land on which these buildings are situated, and certain defined personal property usually located in your residential building.
How do I get EQCover?
When you buy a fire insurance policy for your dwelling or your contents, your insurance company has to charge a disaster insurance premium, which it passes on to the Earthquake Commission. This gives you EQCover for as long as the fire insurance policy remains in force and provided EQCover for the property has not been cancelled.How much cover do I get?
EQC insures your dwelling on a replacement value basis, but there are limits to the amount you can claim (and on which you pay premiums).
These limits are the least of the following :
- the amount for which you have insured your dwelling on a replacement basis (i.e. the replacement sum insured);
- if your fire insurance policy does not have a replacement sum insured, an amount specified by you in the policy for EQCover on your dwelling (which cannot be less than $1,000 per square metre of floor area);
- $100,000 (+ GST) per dwelling.
EQCover also insures some of your personal property and gives cover on the same basis as the fire insurance. So, if your personal property is insured against fire on a replacement basis, EQCover will also be on a replacement basis; but if it is insured on a less favourable basis than replacement value, then EQCover will be on the same basis.
The limit of EQCover for personal property is the lesser of:
- the amount for which your personal property is insured against fire;
- $20,000 (+ GST).
What if I need more cover?
If you think EQCover is not enough for your property, talk to your insurance company who can give youadditional cover.
How much does EQCover cost?
The cost is worked out at 15 cents (+ GST) for every $100 insured. The most you can pay a year for one dwelling and its contents is $207.00 including GST. This will give you the maximum cover of $100,000 (+ GST) for your dwelling and $20,000 (+ GST) for personal property.Are there excesses?
Yes. For a claim on a dwelling the excess is 1% of the amount of the claim with a minimum of $200 per dwelling. For personal property, the excess is $200. For land, the excess is 10% of the amount of the claim, with a minimum of $500 per dwelling and a maximum of $5,000.Why is there an excess when the fire policy has a nil excess?
EQC is a separate entity from private sector insurers and as such has its own excess levels and other conditions which are detailed in the Earthquake Commission Act 1993.What about my section?
There is limited insurance cover on your section, mainly the land around any residential buildings, with some cover for the main accessway and underground services. An excess applies to claims on land.What about subsidence?
The definition of natural landslip excludes damage caused by, "movement of the ground due to below ground subsidence, soil expansion, soil shrinkage, soil compaction or erosion". Therefore, subsidence is not covered by the Earthquake Commission Act.Is all my property covered by EQCover?
Some, but not all, of it is. The property items not covered include motor vehicles, trailers, boats, swimming pools, fences, jewellery, money, works of art, securities and documents.
EQCover insures only direct damage. It does not, for example, extend to paying for temporary accommodation, as some insurance policies do.
For more detailed information on what is covered, refer to the Householders Guide to EQCover, by clicking here
Does EQC cover everything my insurance company doesn't?
No. EQC covers the natural disaster perils defined within the Earthquake Commission Act. They are earthquake, natural landslip, volcanic eruption, hydrothermal activity, tsunami; in the case of residential land, a storm or flood; or fire caused by any of these.
What about flats and apartments?
A "dwelling" includes any self-contained premises that are somebody's home or holiday home. The limit on the amount of EQCover you can have applies to each "dwelling". So a building can contain more than one dwelling, e.g. an apartment block, or a house with a self-contained granny flat. Each building is eligible for cover up to $100,000 (+GST) multiplied by the number of dwellings in the building.
Therefore buildings which include more than one dwelling can be insured for more than $100,000 (+GST). To get full EQCover, you must inform your insurance company of the number of dwellings in your building, otherwise you will only be able to claim up to $100,000 (+GST), regardless of how many different dwellings are in the one building.
If you live in a "dwelling" which you don't own, and you have personal belongings, you can get EQCover on those belongings.
How are claims settled?
EQC sends a letter acknowledging the claim. We will usually appoint a representative to visit the scene of the loss and report back or, if the loss involves minor damage to home or contents, we will send the claimant a form to fill in.
- EQC contacts the claimant's insurer to confirm that they have current insurance cover. This is done while the next steps are being taken.
- If necessary, the EQC representative will appoint a registered valuer to value the damage. EQC also obtains an estimate of repair costs.
- If the damage is severe or threatens the property, an engineer will be asked to report to EQC.
- Once EQC has received all the information about the claim, its representative will explain to the claimant the settlement for the claim.
- When the settlement is determined, EQC will pay the claimant, the mortgagee or the repairer, as appropriate.
How long will it take to settle my claim?
Dwelling and personal property
If it is straightforward, your dwelling and personal property claim should take up to one month to settle. It may take longer if expert advice is needed or if your claim is made at the time of a large natural disaster in New Zealand. It may take longer if your claim is made at the time of a large natural disaster in New Zealand.
Land, retaining wall, bridge and culvert claims
Claims for land, retaining wall, culvert and bridge damage can be difficult to assess. The average time to settle claims is three months. However, the actual time varies according to the complexity of the damage and even weather conditions. We endeavour to have simple claims settled within two months.
What does it mean if I have a 'Section 28' notice placed on my property title?
A "Section 28" notice is placed on a property title if EQCover has been cancelled or limited. EQC can only cancel or limit cover in specific circumstances as set out in the Third Schedule to the Earthquake Commission Act. EQC will advise, in writing, any person affected by the cancellation or limitation of EQCover and explain why it has done so. The notice continues to apply even if a property is sold.
If a section 28 notice is on your property there may be no cover available from EQC or cover may be reduced. The owner of the property should contact EQC to determine the reason for the section 28 notice being placed on the title.
In most circumstances EQCover can be reinstated and the property owner needs to contact EQC to find out what will have to be done, such as remedial works, in order to reinstate the Commission's cover.