About half of the 8500 homeowners shortlisted for increased liquefaction vulnerability (ILV) payouts in Canterbury will receive compensation.

The Earthquake Commission (EQC) last year notified the homeowners their properties may have ILV following the 2010/11 quakes.

Extensive tests including flood modelling, aerial ground scanning and site assessments have been carried out to confirm each property’s vulnerability to future events.

“Following completion of the ILV assessment process, about 4500 green-zone properties have qualified for ILV land damage,” EQC Head of Canterbury Land Settlement Keith Land told insuranceNEWS.com.au.

“EQC is still working through the details of settlements and the costs of these have not yet been finalised.”

It is the first time this type of land damage has been recognised as an insured loss.

“The first qualification packs have gone out this week and we expect to give certainty to all affected customers by early next year at the latest,” Mr Land said.

“We’re confident all the work that has been done to date has contributed to a robust assessment process, which should give homeowners confidence that all properties have been assessed fairly and consistently.”

The EQC will not repair ILV damage but will settle by cash.

The amount will reflect the cost of repair or reduction in market value of the property.

“How exactly it’s going to look in terms of the settlement approaches and the amount for each of the qualifying properties is something we are working through now,” Mr Land said.

Homeowners who qualify to claim will receive a settlement information pack next year.

“We acknowledge it’s taken time to get to this stage and we would like to thank our customers for their patience,” Mr Land said. “We’re confident all the work that has been done to date has contributed to a robust assessment process, which should give homeowners confidence that all properties have been assessed fairly and consistently.”