Southerly by David Haywood

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Southerly: Tower Insurance Have Some Bad News For You

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  • Roger Lacey,

    It's probably been mentioned here before but one of Tower's "Core Values" highlighted on Campbell Live is:

    "Empathy in all that we do. We walk in the shoes of our customers and strive to do the right thing by our customers and ourselves."

    Hah! Maybe you should ask the boss of Tower to come and take a walk in your muddy gumboots then nudge him into the Avon.

    Whatakataka Bay Surf Club… • Since Apr 2008 • 148 posts Report Reply

  • Ian Dalziel, in reply to Roger Lacey,

    “Empathy in all that we do. We walk in the shoes of our customers and strive to do the right thing by our customers and ourselves.”

    or possibly (and much more cynically) they take the shoes off the cold dead feet of their customers, thus avoiding buying their own - and this 'Right Thing' they talk about is behaving like a far right National politician, and haven't ACT been very quiet about this whole earthquake and consequences...

    Christchurch • Since Dec 2006 • 7948 posts Report Reply

  • kevyn,

    David, I don't know if any of the following is going to be of any practical use to you but here goes.

    Tower is wrong to claim that the government has mandated that the land in the red zone cannot be built on. If that was the case you would have received a "Notice of intention to take land" issued under s54 of CERA 2011 and you would be entitled to be compensated at market value under subpart 5 of CERA.

    What the government has done is taken note of the fact that the deformation of the bedrock in the Feb 22 earthquake has reduced the ground levels alongside the Avon significantly so that houses consented since 2004 will not comply with the building code unless there foundations are raised and that they will not be insurable unless that happens (see Part 2 of the City Plan [online] for details of this being measured relative to the CCC Datum Point inthe estuary). The very arbitrary seeming way that houses in some streets have been allocated as red and green argues very strongly against the social dislocation and service disruption arguments being the main reasons for the government offering to buy out home owners in the red zone but not their neighbours in the green zone. Most importantly, note that these are offers of financial assistance rather than compulsory purchase orders.

    While it does not address the ethics of Tower taking money from you for full replacement cover and then refusing to deliver it may well be that your best course of action will be to take their money and either repair the house or bank the cash and then sit tight until CERA is compelled to comulsorily take your property at fair market value.

    Lincoln • Since May 2011 • 4 posts Report Reply

  • Sofie Bribiesca, in reply to kevyn,

    I would certainly look at this option Cantabrians. Bravo Kevyn!

    here and there. • Since Nov 2007 • 6796 posts Report Reply

  • Sacha, in reply to kevyn,

    sit tight until CERA is compelled to comulsorily take your property at fair market value

    While I otherwise agree with your logic, did you catch the earlier discussion that 'market value' in red zones when assessed will be close to zero?

    Ak • Since May 2008 • 19729 posts Report Reply

  • Fooman, in reply to Sacha,

    While I otherwise agree with your logic, did you catch the earlier discussion that ‘market value’ in red zones when assessed will be close to zero?

    Since the insurance companies appear to not consider the land, why should the valuers?

    Land + Improvements is not necessarily zero even if Land = zero, for sufficiently large value of Improvements.

    A nice, new, replacement house on shit land is still a nice, new replacement house. The receipts for materials and labour can be pointed to as a very good (and recent) guide to the value of the improvements on the property.

    The cost of the land will have been addressed by taking up the land only side of the offer (still at a relative loss to pre-Sept values).

    FM

    PS. The automated conversion of 0 (zero) into what seems like a lower-case "o" sucks big time admins...

    Lower Hutt • Since Dec 2009 • 87 posts Report Reply

  • DexterX, in reply to Sacha,

    The assessement - would it be the market value at the date of the incident.

    Whereas total replacement is something altogether different.

    Auckland • Since Nov 2006 • 1224 posts Report Reply

  • Sacha, in reply to Fooman,

    I'd say the market value will hinge on amenity, wouldn't you? If a house is unusable because of where it is, I doubt any other factors will count much.

    And if the government are prepared to do deals with the insurance industry to claim white is black, what makes you think the terms of CERA's assessment of any holdouts would be at all favourable?

    Ak • Since May 2008 • 19729 posts Report Reply

  • Sacha, in reply to DexterX,

    The assessement - would it be the market value at the date of the incident.

    From what was discussed earlier, the value is at the date of assessment - say, in nine months time when plans to bulldoze houses and rip up existing services are in place and only a few holdouts remain.

    Ak • Since May 2008 • 19729 posts Report Reply

  • Melmac, in reply to kevyn,

    Thank you for your informative comments. They will be very useful to many Christchurch residents. :)

    Christchurch • Since Jun 2011 • 7 posts Report Reply

  • Hebe, in reply to kevyn,

    Good one Kevyn. My gut is that if hold-outs are numerous enough and vocal enough and persistent long enough that the banks will begin to take an interest and ask questions of Key, if not demand answers. Which bank has the most exposure to the Chch housing market; find out and start working on them too. Banks are worried already about the prospect of mass mortgage defaults; they cannot and will not let the Govt sign them away in favour of insurers.

    Christchurch • Since May 2011 • 2899 posts Report Reply

  • Joe Wylie, in reply to Ian Dalziel,

    . . . haven't ACT been very quiet about this whole earthquake and consequences...

    As always with those fawning blowhards, individual property rights are only sacrosanct when they benefit those further up the food chain.

    flat earth • Since Jan 2007 • 4593 posts Report Reply

  • Sacha,

    The Royal Society have released an information paper on #eqnz building design issues. (h/t Cheryl Bernstein)

    Ak • Since May 2008 • 19729 posts Report Reply

  • Sacha,

    Speculation at launch event for that report about the impact on future insurance for building owners.

    Some Christchurch buildings may be regarded as "uninsurable" or the premiums set for them may be too costly for their owners, says a senior engineer involved in the reconstruction of Christchurch.

    Structural Engineering Society president John Hare, a director of the Holmes consulting group, said today that he would "certainly expect" insurance companies to be more selective in future about which buildings they would insure.

    "I would certainly be expecting that some of the buildings at the lower end of the scale - certainly earthquake-prone buildings, but other buildings of types shown to be prone to damage - may not be insurable, or may be prohibitively expensive to insure," said Hare, who is a principal engineering adviser to Canterbury Earthquake Recovery Authority (Cera).

    Ak • Since May 2008 • 19729 posts Report Reply

  • Lucy Telfar Barnard, in reply to Fooman,

    even if Land = zero

    And further, I doubt the land value would be zero. I'm currently in England, and regularly see plots of land sold as "holding investments" or other marketing fluff, despite the fact the land cannot currently be built on, due to zoning, but which have a value on the basis of some possibility that at some distant time in the future they might be rezoned. There's no suggestion this rezoning will happen soon, or even at all, but the mere fact it theoretically might is enough to give the land value based on location rather than farming use.
    In this case the govt talk is that the land will, rather than might, be available to build on again at some time in the future, so the land market value is definitely not going to be zero. How much it is worth is another matter, of course, but there's probably some economics person who can figure it out - bearing in mind that the council would be pretty unreasonable to charge anything like normal rates for it given the lack of services.

    Wellington • Since Nov 2006 • 585 posts Report Reply

  • Sofie Bribiesca,

    If and when possible, NEVER sell the land! In this country land is your investment. The bricks and mortar, not so much. timber is more reliable in NZ as we happily pick up and move that asset. Fact is, the stuff on the land is always disputable on value. The land will always be there even if it's a swamp for some time. No matter. For an example half my parents land was swamp back in the 70's. Yes it was child labour when my parents made me wheelbarrow landfill as punishment for breaking my 1 am curfew. But now, there is a very valuable piece of Remuera north facing hectare that I will inherit 1/4 of one day.And just like fashion, someone will always want it.Another guy I know, spent 9 mil on a waterfront property with a derilect building on it. he didn't care about the building, he liked the view.The land is what has value to the Council. Hang onto it. maybe even consider something selling up cheap in a green zone and rebuild or move your house onto that as soon as is possible. Perhaps other than Brownlee authorised Demolition people can help in moving your house onto that. I'd look there as there must be many begrudging the elitist contracts to certain contractors.
    I know it is despairing and depressing but now all the creative types need to think outside the square. First understand the stink sytem/headspace that governs all of this ,then create or find the loophole. This crew is not infallible. We see it all the time and many a person on this here thread is better. :)

    here and there. • Since Nov 2007 • 6796 posts Report Reply

  • Kumara Republic, in reply to Joe Wylie,

    As always with those fawning blowhards, individual property rights are only sacrosanct when they benefit those further up the food chain.

    Or to put it succinctly, Terra Nullius.

    The southernmost capital … • Since Nov 2006 • 5434 posts Report Reply

  • David Haywood,

    Quick report:

    I currently have the Tower assessor in my house. Apparently they have been instructed not to wear Tower logos in public due to abuse/threats. This is awful to hear, and I hope that -- however high tensions are running -- people remember that the workers on the front line aren't responsible for company policy.

    In other news: the assessor has informed me that they are estimating foundation repairs as for undamaged ground. This is entirely contrary to the building code, and I guess the lawyers are going to have to be involved now. Sigh.

    Dunsandel • Since Nov 2006 • 1156 posts Report Reply

  • andin, in reply to David Haywood,

    foundation repairs as for undamaged ground.

    Is this another directive from head office?
    Act as if nothing has happened? mmmmmmm

    raglan • Since Mar 2007 • 1890 posts Report Reply

  • Hebe, in reply to David Haywood,

    But the land is so poked that the Govt has declared it uninhabitable! Surely Tower's view cannot stand up in law. Stand strong David.

    Christchurch • Since May 2011 • 2899 posts Report Reply

  • 3410,

    Apparently they have been instructed not to wear Tower logos in public due to abuse/threats.

    Perhaps, but I find that hard to believe.

    Maybe a precaution against unflattering news video?

    Auckland • Since Jan 2007 • 2618 posts Report Reply

  • Emma Hart, in reply to 3410,

    Perhaps, but I find that hard to believe.

    I don't, not at all. I've heard the same thing for people working for EQC.

    Christchurch • Since Nov 2006 • 4651 posts Report Reply

  • 3410,

    Okay, I defer...

    Auckland • Since Jan 2007 • 2618 posts Report Reply

  • andin, in reply to Emma Hart,

    I’ve heard the same thing for people working for EQC.

    It must be getting really tense in CHCH if a logo on a shirt is precipitating anger at the wearer.

    raglan • Since Mar 2007 • 1890 posts Report Reply

  • BenWilson, in reply to andin,

    It must be getting really tense in CHCH if a logo on a shirt is precipitating anger at the wearer.

    Understandably tense, and horrible for the people involved - there's nothing nice about being the tool of bad news delivered from above, and these people mostly live in Christchurch themselves and have suffered too. It would not be a good outcome if being a Tower assessor became such an undesirable job that no-one local wanted to do it, because it can only slow the process down, and ring-ins from out of town would have less to lose, and be chosen (and paid) for their hardness, so the positions would be more likely to polarize to a disastrous stand-off. But sometimes these things have to happen, if the people above really are that callous.

    Government can't wash their hands of this. A Muldoonish "sport isn't the government's business, but law and order is" approach could easily lead to riotous confrontations that divide the nation. I don't want to see an emergent "fuck Christchurch" camp in our politics, when it could be resolved by better communal engagement with the question of "what should be done about the disaster?". Silence and backroom discussion just isn't an option.

    Auckland • Since Nov 2006 • 10655 posts Report Reply

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