Insurance, New Zealand updates

Earthquake class action against insurers – what is a common interest?
  • New Zealand
  • March 07 2017

A recent High Court judgment has surprised some observers by allowing a representative action of homeowners to proceed against a government-owned earthquake insurer. The judgment is of note because it followed an earlier refusal by the same court to give the group leave to proceed. The case offers the opportunity to compare the unsuccessful and successful applications and briefly survey the landscape of such actions.

High Court examines insurance cover across two policies
  • New Zealand
  • January 03 2017

The High Court recently issued a decision regarding the coverage offered to the directors and general manager of a trust fund management company by a professional indemnity policy and separate directors' and officers' cover. The decision highlights that courts will consider a number of relevant factors to interpret multiple policies, the most relevant in this case being the commercial intent of the policies as a whole.

Insurance Council of New Zealand flexes its muscles
  • New Zealand
  • November 15 2016

The Insurance Council of New Zealand (ICNZ) recently announced that Youi New Zealand Property Limited must pay the maximum fine of NZ$100,000 for failing to conduct business in accordance with the Fair Insurance Act. The fine is less significant than the ICNZ's clear message that it will use the full extent of its powers to protect the insurance industry's reputation and raise the standards and services that insurers provide to consumers.

Supreme Court to consider whether mistake can undo settlement agreement
  • New Zealand
  • August 09 2016

A recent Court of Appeal decision has been praised as a victory for parties with a legitimate interest in seeing that release agreements are routinely upheld and enforced. However, the Supreme Court recently gave leave to appeal the decision. One of the approved grounds is the effect of the parties' release agreement, which will again shine a spotlight on the effectiveness of properly drafted settlement agreements.

Insurer not bound by settlement between home owners and Earthquake Commission
  • New Zealand
  • June 21 2016

Natural disaster cover under household insurance cover is often payable only to top up what the Earthquake Commission (EQC) has paid. Usually there is cooperation between the EQC and insurers to agree on apportionment between earthquakes and whether damage is over or under the cap which triggers insurance cover. If agreement is not reached, the EQC may settle directly with the home owners.

Reserve Bank of New Zealand to review regulation of insurance industry
  • New Zealand
  • April 26 2016

The Reserve Bank of New Zealand is to review the operation of the Insurance (Prudential Supervision) Act 2010 and the associated regulations. A review is timely and it will be interesting to see how much input there is from public interest groups, as the public has had a lot to say about the standards expected from insurers in some recent high-profile complaints and litigation.

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