Christchurch-based businesses are starting to see business interruption (BI) cover run out a year after the September 4 earthquake, although this will become more of an issue as the February 22 anniversary approaches.

NZI EGM Karl Armstrong says some companies did enact cover after the September 2010 event, but most commercial claims relate to the February 22 earthquake.

He says insurers have been working through claims and the industry is “working flat out to find solutions, although not all solutions will work for everyone”.

He says a number of clients have taken out BI cover for longer than 12 months and many have found alternative premises and continued trading.

“It is surprising how many clients have set up elsewhere (outside the Christchurch central business district),” he told insuranceNEWS.com.au.

Companies had found office and retail space in the suburbs and some smaller manufacturers are back in production.

Mr Armstrong says that while insureds’ experience of BI cover will be mixed, it has worked well for clients who received early payments that enabled them to pay bills such as salaries and wages.

Once the CBD was cordoned off there were concerns that clients who had not incurred any damage would not benefit from BI cover although they could not get into their businesses and there were no customers around.

Mr Armstrong says each insurer has been working through the issue to find a solution.

BI cover does not apply to loss because of an economic downturn or changed consumer preferences.

He says there has been a lot of this in Christchurch, and it is hard to measure how businesses are affected when consumers decided they do not want to go out and leave children at home.