I am publicizing the following as a cautionary tale for Israel, which is faced with earthquake threat any time now, as the last serious earthquake was at 1927 and such earthquakes repeat each 80-100 years.
A week ago, the government of Israel carried out a large scale exercise to simulate the effects of a big earthquake with a tsunami. The exercise revealed several problems in preparations for the disaster. The exercise was not intended to, and it did not address long-term disaster recovery needs.
Turns out that in New Zealand, they have a big problem recovering from the earthquakes which struck Christchurch at 4 September 2010 and later dates. Some of the culprits are the various insurance organizations, which were paid premiums over the years in order to help people recover from such natural disasters.
It made me very worried because if even the developed and well-managed country of New Zealand does not do good work recovering from natural disasters, what hope do we have in Israel? Especially as the various insurance bodies in Israel are as bad in settling claims as their New Zealand counterparts.
The following account was written by Bob. He is from Christchurch, New Zealand. The account was taken, with his permission, from an E-mail message which he sent to an international mailing list to which I am subscribed as well.
The account starts here:
It’s very slow Alan. The council had a zone system setup after the main shocks, in which buildings are red-stickered, white-stickered, green… etc. Just a day ago – more than 2 years after the September 2010 quake – they
have finally decided what the last few houses are to be zoned as.
The council, as well as the EQC (earthquake commission) and CERA (Christchurch Earthquake Recovery Authority) have cooked up a grand recovery plan, with new buildings to be placed in certain areas designated as the port zone, culture zone etc. Some of the areas contain perfectly fine buildings (one is brand new) and yet are to be pulled down to suit the plan.
The EQC is a govt agency, and if you have building insurance an extra charge is compulsorily added to your premium for disaster recovery insurance. Everyone has been paying this for years, but now we discover that the premium is way too low to pay for much of it. The Government was warned years ago about that, but the finance Minister (same one we’ve got now, Bill English) ignored the warnings.
After the major disaster, this tiny govt department (all they’ve done for years is collect our money and do a poor job of investing it) then had to recruit many new people, such as ex-cops from Australia or unemployed , to go around inspecting homes and buildings to decide what the damage was. Most of these people are NOT builders and had no experience in building work, so they gave them a checklist and iPods, along with dopey assistants, and sent them off.
Our home, only lightly damaged, had to wait over a year for the first inspection, which was followed up by 2 more because the first was lost in the paperwork. One set of inspectors only walked around the outside – didn’t bother to check the inside at all.
A single commercial company, Fletchers, was appointed as the master repair company and they hired contractors to do the repairs. Some contractors have been fiddling the books, and I’ve heard more than a few crims were taken on (very little checking done) as ‘specified repairers’ who had ulterior motives i.e. checking out homes for valuables so they can send burglars in later (armed with a handy floor-plan and details of where stuff was to be found).
The insurers are the worst bunch of crooks ever. Lots of people are still waiting for payouts for damage to their unlivable homes, while they still have to pay rates and mortgages on and cant sell up, while at the same time having to move into rental accommodation (increasingly in short supply) with rents going up and up so that landlords can grab their share of the money to be had.
For everyone who has house insurance, I suggest you check the fine print and see if there is a time limit by which claims have to be settled by the insurers.
AIG in particular is getting a lot of flack for not responding to claims. You insure your house, and expect to get paid out for repairs when it’s damaged – but what if the insurer takes your claim, then just ignores you – for months, years even?
It will be next year (3 years after the first quake) before the repairs start to ramp up. We’ve had people from the UK come out to help (builders, tradesmen etc) then gone home again because there was nothing for them to do yet (if they wanted to get paid that is).
All in all, while the quakes made a real mess of the city, the ‘repair’ system is a major disaster in itself – no-one seems to know what’s happening. Roads are still a mess, it sometimes takes an hour to get across what is just a small city after all.
Its very depressing, and no wonder that loads of people have said ‘Enough’ and left the city for good.