The New Zealand Insurance and Savings Ombudsman is investigating complaints about offers made by insurers to some customers in the Canterbury “red zone”, but admits the row over repairs and rebuilds is a vexed issue.

Earthquake Response Manager Iain Opray told insuranceNEWS.com.au that although there have been a few complaints to the ombudsman, the office has to interpret the policy, and insurers are sticking to policy documents in estimating the cost of fixing buildings that can be repaired.

The Government has ruled that land in red zones is damaged beyond repair. Affected claimants argue they should be paid out so they can rebuild elsewhere, as they will not get council permits for repairs.

Mr Opray says the ombudsman is telling claimants to get an independent costing from a quantity surveyor to ensure all repair costs are included.

He says the magnitude of the Christchurch earthquakes has complicated the insurance process as thousands of people are affected by every decision.

The Government has made an offer to red zone residents either to buy their houses and land, based on rateable values, or to buy the land and allow the claimant to negotiate with their insurance company.