Loss adjusters are processing earthquake claims for failed New Zealand insurer Western Pacific after a court ruled liquidators could pay from reinsurance funds.

In a report to creditors, liquidators David Ruscoe and Simon Thorn of Grant Thornton say adjusters Cunningham Lindsey will continue to provide services.

They have been liaising with the Canterbury Earthquake Recovery Authority and the Earthquake Commission to obtain information about damage to insured properties.

Western Pacific went into liquidation in April last year. Its only substantial asset is $NZ34.8 million ($27 million) in reinsurance.

The NZ High Court had ruled reinsurance funds were available only for claims accepted from the September 2010 and February 2011 earthquakes, but it has now allowed the money to be used to pay loss adjusters.

The liquidators do not expect any claims to be paid in full but are working to obtain the highest possible reinsurance payout.

Western Pacific’s total claims are estimated to be $NZ64.9 million ($50.4 million), of which earthquake claims make up $NZ48 million ($37.3 million).

The report says the liquidators expect to recover $NZ34.8 million in reinsurance and $NZ2.5 million ($1.9 million) in reinsurance premiums, leaving an estimated claims shortfall of $NZ27.6 million ($21.4 million).

It is unlikely other funds will be available to pay unsecured creditors, including non-earthquake claimants, but there may be some recovery from potential actions against professional advisers and directors, the liquidators say.

Claimants are mainly commercial, with a small number of residential claims in the red zone, meaning they are affected by a government offer to either buy houses and land or buy land and let the claimant negotiate with their insurer.

The liquidators are pressing brokers to pass on held premiums, which are due in accordance with brokerage agreements between the brokers and the company.