Insured businesses who receive delayed payouts from their insurer after a natural disaster fare no better in their economic recovery than uninsured businesses, research has found.

Research into New Zealand’s Canterbury earthquakes by research group Resilience to Nature’s Challenges also found that insured businesses that were paid promptly recovered much better than those without insurance.

“This highlights the importance of timely [claims] payments,” the research team says.

Separate research into residential insurance payments made by the Earthquake Commission (EQC) found that for every 1% increase in payouts for building damage, economic recovery increased by 0.36%.

Only 2% of properties in Christchurch were uninsured at the time of the earthquake.

The resilience research project’s leader, Victoria University of Wellington economics professor and chair of studies in the economics of disasters Ilan Noy, says this is the first time that detailed post-catastrophe insurance payments have been empirically linked with better local economic recovery.

The insurance payments were staggered over five years, allowing the team to identify their local impact.

Some homeowners received their payments from the EQC in cash. Claims for repairs between $15,000 and $100,000 were handled through the managed repair program.

The research found that cash payments contributed more to local recovery than the program, and delayed payments contributed less.