Taking apportionment into account, when the property owner and the insurer believe that the claim is over cap but EQC is still holding the claim under cap, and the insurer has a building inspection report and reinstatement recommendation in excess of $180,000, what is the insurer’s liability to the policy holder?
Asked: 5 April 2014
There is no liability until the claim is deemed over cap by EQC. Speak to your claims case manager about your concerns.
Apportionment relates to the amount of damage that occurred during a certain event, provided that Lumley agree that the EQC SOW covers all of the damage, then there should be no dispute. If Lumley have a SOW for $180,000 and EQC’s SOW and methodology matches but it happens that the damage occurred over several events then the insured is still getting the repairs completed but it will be managed by EQC.
Lumley can only dispute this if they assessed and scoped prior to an event occurring and then we could dispute the apportionment of the claims.
Southern Response advises:
If we agree with the customer, the insurer’s liability is the difference between what the insurer and the customer agree EQC’s contribution should be. The insurer will also be liable for other earthquake damaged property not covered under the EQC Act, but covered under their policy.
SR will not progress a claim without a cap payment having been made?
As the insurer we are not able to assume responsibility for the management of a claim until EQC have confirmed the property is over cap. We can, however, arrange a joint review with EQC and provide them with any reports that may support our position that the claim is over cap.