New Zealand’s Earthquake Commission (EQC) and insurers are working on a modelling system that will enable them to apportion costs between the Canterbury earthquakes and speed up claims resolution.

The reinsurers who are covering around 90% of private insurers’ costs from the Canterbury earthquakes will have to approve the proposal.

Insurance Council of New Zealand CEO Chris Ryan says insurers and the EQC have analysts working through data from the events to try to apportion costs, and once they have a model they will put it to reinsurers.

“Reinsurers have to be comfortable with the solution,” he said. “If not, it won’t be able to be done.”

The industry has been able to work on the modelling approach following last year’s NZ High Court ruling that decided how liability per event applied to the EQC and private insurers.

The court ruled that the EQC’s cover reinstates immediately after each event rather than the earthquake series as a whole, which means the EQC will carry a higher proportion of losses.

The EQC covers the first $NZ100,000 ($78,270) of home building damage and higher amounts are then passed to private insurers.

It has defined 15 separate Canterbury earthquakes and aftershocks for insurance purposes, but the frequency of the events has complicated the task of apportioning damage between them.