A dispute between the Port of Lyttelton and its insurers over an $NZ11 million ($8.4 million) claim for earthquake damage looks headed for the courts.

Lyttelton, the major port for Canterbury, claimed on its property and business interruption cover following the earthquakes, which severely damaged wharves, paving and seawalls.

Lyttelton Port Company Chairman Rodger Fisher told the AGM the corporation has received progress payments of $NZ35.7 million ($27 million) for business interruption and property damage.

A further progress claim of $NZ11 million was made in August, and the claim has grown to $NZ20 million ($15 million) as a result of additional expenditure over the past few months.

But he says the port’s lead insurer, Vero, has advised “that at this stage they are disputing the progress claim”.

“We are taking this issue very seriously and we will be taking all necessary legal advice.”

Mr Fisher says the dispute appeared based on a difference of opinion as to the extent to which port assets were insured for reinstatement.

He told the meeting the total insurance claims will be significant and impact materially on future financial statements.

The port now carries limited cover for damage including fire and collisions. It has been unable to get earthquake and business interruption cover.

CEO Peter Davie told insuranceNEWS.com.au insurers have started to re-enter the Christchurch market but the port’s difficulty in obtaining cover is an indicator of the situation facing all businesses.

He says banks will not lend to firms that do not have insurance and this will affect the rebuild and the city’s recovery.

The port handled a record number of containers in the quarter to September 30 and expects to be busier when the rebuild is fully under way.