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Earthquakes drive complaints to NZ insurance ombudsman

Complaints and enquiries to New Zealand’s Insurance and Savings Ombudsman (ISO) rose 74% in the year to June 30 as consumers and insurers disputed Christchurch earthquake claims.

The ISO handled more than 600 Christchurch earthquake complaint enquiries and received 33 complaints for investigation, according to its annual report.

Ombudsman Karen Stevens says complaints must reach “deadlock” in an insurer’s internal dispute resolution (IDR) scheme before they reach her office, so “we are aware there are likely to be many more complaints about the earthquakes referred to the ISO scheme in the years to come”.

As well as general insurance, the ISO handles credit contract, health and life insurance, superannuation and securities disputes valued at up to $NZ200,000 ($160,700). It received 2833 complaint inquiries in 2011/12.

General insurance comprised 75% of all complaints in 2011/12, compared with 61% the year before, while life and savings insurance made up 14%, down from 21%.

The report shows 74% of all complaints referred to the ISO, having failed at IDR, were not upheld. Another 23% were settled, 2% were upheld and 1% were partly upheld. About $NZ984,000 ($790,900) was paid to consumers who had complaints considered by the ISO.