A New Zealand class action against Southern Response regarding Canterbury earthquake payments has gained litigation support from Claims Funding Australia.

Southern Response is the government-owned company responsible for settling the Canterbury earthquake claims of policyholders who were insured through AMI, a local insurer that was overwhelmed by the claims. While AMI was acquired by IAG in 2012, the earthquake claims are paid by the Government through Southern Response.

Class action lawyer Grant Cameron says the contract will ensure the matter can be seen through to completion, allowing policyholders to seek redress over settlement entitlements.

“On the information to hand, it seems there may be about 3000 affected policyholders and there could be about $NZ300 million ($281 million) in issue,” Mr Cameron said.

Claims Funding Australia, owned by class action law firm Maurice Blackburn, started funding in 2009 and says it has conducted the six biggest actions in Australia.

The New Zealand class action alleges policyholders who settled with Southern Response before October 2014 were misled about the full extent of entitlements, which should have included amounts for contingencies, design fees and other costs.