IBANZ seeks changes to include EQC in new bill
NZILA President’s message – Myles Noble
The Insurance Brokers Association of New Zealand (IBANZ) is concerned the Financial Markets (Conduct of Institutions) Amendment Bill does not cover the Earthquake Commission (EQC).
IBANZ CEO Mel Gorham told Insurance Business’s NZ online news service the EQC was technically not an insurer or financial institution but provided the first NZ$150,000 cap of natural disaster cover for every home in New Zealand.
She said the bill captured insurer conduct, but not EQC conduct, which was “unsettling”.
The bill, which aims to ensure financial institutions and their intermediaries comply with a principle of fair conduct and associated duties and regulations, has reached its second reading in the NZ Parliament.
Ms Gorham acknowledged private insurers largely handle the claims process after natural disasters, but criticised EQC’s non-inclusion in the bill because its insurer partnership agreements do not cover all NZ insurers.
She said the issues IBANZ had raised “will lead to uncertainty, impact on the availability of independent financial advice, and restrict product choice”, all of which would “worsen, rather than improve”, outcomes for those the bill sought to protect.
More information on the bill is here.
Under the new Natural Disaster Response Agreement (NDRA), which came into effect from 1 July 2021, private insurers party to the agreement will act as agents for EQC in the claims process, including for under-cap claims. It means claimants have a single lodgement, a single assessment and a single settlement.
Insurers that are party to the NDRA-EQC agreement are working through these changes and already New Zealand has experienced several weather events that have given insurers some early experience of the new processes and the opportunity to address any teething issues.
It is fair to say the industry welcomes these changes, however, the real test will come in the event of another major natural disaster.
As I write this column, the whole of New Zealand has unfortunately re-entered a level 4 lockdown. While we hope this lockdown will be brief, our 2021 Conference Committee has made the difficult decision to postpone this year’s conference until 28-30 September 2022 in Queenstown.
All 2021 registrations will be automatically carried over to 2022. I thank the Conference Committee for all their hard work and my thoughts go out to them with having to make this disappointing but necessary decision.
We will communicate with NZILA members shortly about a new date for the AGM that was to be held during the conference.
The conference would also have marked the end of my three-year term as NZILA President. I feel privileged to have held this position and have enjoyed my term immensely. I wish my successor well, thank the National Committee and our Secretariat for their support, and look forward to continuing my involvement in NZILA as Past President.
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