EQC is broken and needs to be rebuilt. Or does it? If the complexity of the situation, some complaints and conflict are to be expected, right?

Let’s look at the facts. The first Canterbury earthquake occurred over 3 years ago. In February it will be three years since the second, but the rebuild has barely begun. EQC admitted recently that its 2013 rebuild targets have been missed, just like the 2012 targets before that. In large part the problem seems to stem from it underestimating the number of houses in need of substantial repair.

In the face of so much frustration, EQC's defenders point to the mammoth scale of the task. The government likes to call the rebuild "the biggest economic undertaking in New Zealand’s history". Gerry Brownlee likes to say, "Canterbury is the fourth largest natural disaster insurance event in history".  

But is EQC’s task unprecedented? Christchurch is not the first New Zealand city to be rebuilt after a catastrophe. The 1931 Hawke’s Bay Earthquake is still the country’s deadliest natural disaster. The earthquake, and the fires which followed, destroyed or damaged the majority of the buildings and infrastructure in Napier and a high percentage of the buildings in Hastings, Waipukarau and Wairoa. Significant aftershocks continued for a year.

In 1931 New Zealand had a population of 1.5 million and was in the third year of the great depression. Roads and support infrastructure were poor by today’s standards. There was little insurance cover and of course no EQC. The rebuild was financed by low cost government loans. Despite the extent of the damage and the limited resources, it took less than two years for Napier and Hastings to be declared re-opened with a 'New Napier' celebration day in January 1933. The vast majority of buildings rebuilt were completed in 1932 and 1933.  

Modern day Christchurch is not Napier in the 1930s, so what about other modern earthquakes in modern countries? Gen Re, one of the three big international reinsurers has paid 91% of claims for the horrific quake and tsunami in Tohuku, Japan, which killed over 15,000 and is described by the World Bank as the costliest natural disaster in world history. It's also paid out 100% of claims for the 2010 Chilean quake and tsunami, which destroyed 1 in 10 homes in the city of Concepcion.

In Christchurch? The comparable figure is 26%.   

Some of the delay, we are told, is because of aftershocks which continued up until June 2011. But in the Hawke’s Bay aftershocks continued into 1932, in Chile aftershocks were recorded in January 2011, and in Tohuku, aftershocks have occurred as recently as October 2013. So why is Christchurch different?

Gen Re’s Global Treaty Manager said that, in part the delays were due to “issues… with EQC”. Lawyers acting for the earthquake affected have seen that the biggest barriers to people moving on and settling their claims for damaged or destroyed homes is EQC’s handling of their claims.

As a lawyer, I’ve seen examples where an insurer has assessed quake damage as costing several hundred thousand to repair, only for EQC to come back with a figure of less than a quarter of that. Insurance companies aren’t known for their generosity.

I’ve also seen examples where EQC staff don’t understand the simple claims handling process set up by Parliament. It is common for people to be offered a settlement with the threat that if it’s not accepted they will go back to the bottom of the pile and will wait more months or years, this delays the Insurers from settling their portion of the claim.

The role of EQC is to provide affordable, basic, earthquake insurance cover that would otherwise be unobtainable or uneconomical, to enable New Zealanders to recover from disaster. It is failing – time it was rebuilt.