Insurance & Savings Ombudsman Scheme support for Christchurch

By Karen Stevens, Insurance and Savings Ombudsman

For nearly two decades, the Insurance and Savings Ombudsman (ISO) Scheme has provided free support and advice for thousands of consumers.

Our experienced disputes resolution team has adapted to a rapidly changing insurance and financial services sector over the years. But the impact of the Canterbury earthquakes has been unprecedented.

The scale of damage, and the cost to peoples’ lives, livelihoods, and homes created immediate pressure on the insurance industry and resulted in permanent change.

We are very aware that unresolved insurance claims in Canterbury are still causing strain and frustration for many people, and we want to help where we can.

So far, our dedicated Canterbury Earthquake Response Team has dealt with over 1300 complaint enquiries, on issues such as: the scope of rebuilds and repairs; interpreting policies; declined claims; temporary accommodation costs; and delays.

Of the completed formal complaints relating to the Canterbury earthquakes, 40% have had positive outcomes for consumers. This means the complaint has been either settled or upheld.

A complaint is more likely to be settled than upheld. And, contrary to misleading claims that the relatively low number of ‘upheld’ complaints equates to failure, a settled case is ultimately preferable.

Each year we deal with well over 3000 complaint enquiries and around 280 formal complaints about financial services. Over 25% of our formal complaints result in settlement.

Settlement means we have successfully facilitated an agreement between the consumer and the insurer. Settlement often relates to the insurer paying an agreed amount to settle the claim. This is a positive outcome for both parties, rather than an imposed decision on one party.

As an approved disputes resolution scheme, we are bound by our Terms of Reference and we have to follow a specific process. But we are being as flexible as possible within these parameters to provide assistance in Canterbury.

For example, a positive step for Southern Response customers is the agreement by Southern Response to waive our jurisdictional limit of $200,000, to investigate their customers’ earthquake complaints.

To make information more available, our Canterbury Earthquake Response Manager has been giving presentations and meeting groups in Christchurch to discuss our role; key insurance issues and policy changes.

At the enquiry stage, we provide information and guidance. We help to pinpoint and articulate what the issues are; identify what steps to take; and help you make informed choices.

By helping to resolve issues up front, we can potentially avoid the escalation of issues into formal complaints.

We can only formerly investigate complaints after they have been reviewed by your insurer’s complaints process. But we can still help talk you through the next steps in resolving your insurance problems, guide the process along, and sometimes speed it up.

When assessing formal complaints, our case managers use their mediation skills, and their industry and legal knowledge, to consider the facts, interpret policy, and apply the law.

The reason a large number of complaints are not upheld or settled in favour of the consumer is there is simply no cover under the policy. Consumers have sometimes been encouraged to believe they have an entitlement under the policy when, in fact, they have no entitlement and are ultimately very disappointed.

The ISO Scheme is an experienced and independent disputes resolution scheme providing free support for consumers. But we are not an advocacy service.

If consumers are unhappy with the outcome we reach, they are not bound by our decision and they can still take their case to court.

We urge all consumers to read their insurance policies carefully, to understand their options and to make informed choices.

Please see our website for information relating to Canterbury, and please contact our office any time with any query or issue.

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