New Zealand’s State Services Commission says it will investigate whether Southern Response breached standards of integrity and conduct following allegations of spying from earthquake claimants.

Southern Response is a government-owned company responsible for settling claims by AMI policyholders for Canterbury earthquake damage.

A number of claimants have alleged that the insurer employed a security contractor to spy on them.

Complaints were passed to Minister for Greater Christchurch Regeneration Megan Woods, who referred them to the commission.

“I have decided the appropriate course of action is an inquiry,” Commissioner Peter Hughes said.

“The material I have seen raises questions around compliance with standards of integrity and conduct for State servants. Those questions need to be answered.”

Southern Response says it will cooperate fully with the inquiry, and that the security contractor was deployed due to staff safety concerns.

“At the time the contractor was engaged in early 2014, Southern Response was acting in response to an escalating level of threatening and aggressive behaviour and communications from customers towards staff, the Chief Executive, directors, and the Chairman,” the company said in a statement.

“Given the environment the company was operating in at the time, and conscious of its obligations to ensure the safety of its staff, Southern Response sought external assistance for a security review.

“The contractor was asked to provide independent security advice, and assess the risk to safety of Southern Response employees and directors.”