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Christchurch Earthquakes, a few facts and observations from my experiences as a non local Loss Adjuster.

Updated on March 3, 2015

Brief history of the quakes.

First we need a bit of background because on a world scale these events didn't really cause a ripple, but on a local scale it was devastating.

Christchurch is the largest city in the South Island of New Zealand with a population in 2010 of around 375,000. Known as the garden city and a slice of England with its stone churches and english style gardens in the city and the Avon River which meanders through the city. It is set near the East coast on mostly reclaimed swamp land and adjacent to an ancient rather large caldera volcano that had formed what is known as the Banks Peninsula creating Lyttleton harbour and the beautiful French style Akaroa a million or so years ago.

The first quake on September 4, 2010, hit Christchurch city and regions South and West, Centred about 40 km west of the city and was a good sized magnitude 7.1 causing widespread damage to property and land but no loss of life as it occurred in the early hours of the morning when most sensible people were tucked up and asleep.There were many aftershocks most notably a swarm of 32 shakes on Boxing Day 26 December 2010 causing more property damage but still not life threatening.

Then at 12.50 pm on 22 February 2011 a lesser magnitude but very shallow depth 6.3 quake hit Christchurch City pretty much directly and caused major damage, particularly to the CBD where hundreds of commercial and inner city residential buildings were either badly damaged or completely destroyed, this quake ended the lives185 people. There was major infrastructure damage and widespread liquefaction throughout the city and suburbs.

In June 2011 there was a further series of large quakes with one matching the magnitude of the February quake but there was no further loss of life but massive amounts of liquefaction particularly in the eastern suburbs.

Minutes after the first quake 22 February

Who covers what

In my role as a Loss Adjuster I was sent to Christchurch soon after the September quake to assist with assessing insured property damage. This was mostly commercial property as the first $100,000 plus GST (Goods and Services Tax) of damage to domestic buildings and the first $20,000 + GST of domestic contents along with specific areas of domestic land were covered by the Governments Earthquake Commission. I will detail how that works in another article.

New Zealand has a high rate of insurance cover with the vast majority of the population considering insurance essential or (a necessary evil at least) and earthquake cover is included in most domestic replacement policies. The insurance companies cover all commercial insurance but do not take over domestic earthquake claims until the cost of building damage reaches $100,000 EQC cap and contents exceed $20,000.

Massive job for the insurers.

My previous experience was about 60% motor assessing with some Fire and General as well, I had spent a few weeks in American Samoa assessing quake and Tsunami damage there in 2009 and also 3 plus months in Perth Australia assessing hailstorm damage. So I had limited experience for this scale of event.

Post September most of the locals were pretty shell shocked but Kiwis are very practical and mostly stoic, especially the small and medium sized business owners. The prevailing attitude I encountered was, "well this is a pain in the backside, but no one is dead so lets get on with fixing the damage so we can get on with our lives".

Of course that sounds dead easy but anyone who has made an insurance claim will know that is not how it always works. Even though we have a lot of earthquakes in NZ not many cause significant damage so there was limited experience available in dealing with this type and scale of damage in the insurance industry.

There is little doubt that the insurers did and continue to do their best and are doing so with the best of intentions but there are a myriad of complications which have slowed things down. In spite of this generally speaking reasonable progress has and is being made with settling claims.

The Boxing Day shakes were a definite speed bump but the February quake and aftershocks were catastrophic, apart from the tragic loss of life, a great deal of the progress made beforehand was returned to square one as far as the assessment of damage was concerned.

Some buildings that were damaged in September and had been assessed to be repaired were finished off by the February quake and the damage had to be quantified again as a total loss with all of the complications associated of apportioning which damage to which quake. The same problems arose with minor damage with the main difficulty being a court ruling that the quakes were to be treated as separate events requiring separate claims and in a lot of cases re assessment.

Tranquility amongst the Chaos

Help from overseas.

In order to shore up our local assessing resources many Loss Adjusters were called in from overseas with personnel from North America, Australia, South Africa and the united Kingdom supplying the most.

It soon became apparent that there were differing styles of assessment but overall it worked pretty well for insurers and in the company I contract to there are a group of Adjusters from the UK who have been out here since the February quakes.

How much ??

The damage caused by the earthquakes have been noted on a world scale as one of the largest insurance events ever.

Currently, the private insurance companies together had settled around 80% of domestic claims totalling around NZ $ 5 billion and paid out a further NZ $ 8 billion of commercial claims with many complex claims still awaiting settlement. On top of this the EQC is anticipating a total payout of all of its claims covering building, contents and land to be in the vicinity of $15 billion.

Claims, assessments and complications

The job for the insurers, adjusters and estimators and back office staff was immense. The amount of claims to insurers and the EQC was in the hundreds of thousands and the majority of people in Christchurch and surrounds were affected in some way.

Our little country of 4 1/2 million had never experienced anything quite on this scale and it tested our resources beyond our initial capabilities. The EQC went from 23 full time employees to well over a thousand staff in a very short space of time. EQC and private insurers were faced with rapidly training hundreds of completely green staff to handle very complicated and high pressure work in a very short space of time.

There was a massive amount of initial emergency work to be organised and normal methods of dealing with claims were put to one side to get things moving. This of course caused problems concerning claims as time went on and much that was done early needing to be redone often more than once.

This lead to frustrations from claimants. As someone who was in the field the assessing work gradually turned into a bit of a grind dealing with what seemed to be endless complications and roadblocks. Our intent was always to get things moving and completed within the bounds of the policy wordings. There was a widespread lack of knowledge from insured parties as to what the insurers and EQC actually covered and with the additional difficulty of separating and apportioning damage to different events things were getting heated at times.

I must say that personally I had a good run with 99% of my site visits and found that once people had had their say and got it off their chest things settled and we could get on with the assessment.

This was not always the case and it reached a stage where the suburban EQC Hub offices located throughout the city had to have security fencing and security guards put in place. Thankfully nothing too serious developed.

Where is it at today

There has been a lot of progress made and insurers and EQC have completed many repairs and cash settlements to mostly satisfied customers. There have been problems along the way but percentage wise the numbers are low. There is a long way to go with the rebuild with infrastructure and new commercial and residential projects underway. It will take a good number of years to complete but we are confident the curve is travelling firmly upwards.

I will write another article outlining the EQC structure and some of my experiences working with them as well.

I hope you found this interesting and thank you for taking the time to read this article.


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    • P A Dando profile imageAUTHOR

      Paul Dando 

      3 years ago from Palmerston North New Zealand

      Yes I know, i worked in amongst it for 3 or so years and the damage is much more severe and widespread than even a lot of the locals realise. it's been an experience interacting with the people there, by and large they have proven to be very resilient. There's a long way to go for some.

    • aboutaustralia profile image


      3 years ago from Newcastle, New South Wales

      I visited Christchurch last year and was stunned and deeply saddened by the sheer scale of the devestation. I truly don't know anyone could decide to stay and rebuild. Definitely a resilient bunch with amazing spirit!


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