Southerly by David Haywood

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Southerly: Tower Insurance Have Some Bad News For You

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  • Che Tibby,

    a friend at the DomPost says they're bringing your story to the attention of the Press.

    and i think BlairMacca is right (lost that point in the red mist after reading your tale). isn't there some devil in the detail there? the Gubbermint should be paying out the pre-2010 valuation of the house, then taking it up with Tower themselves?

    the back of an envelope • Since Nov 2006 • 2026 posts Report Reply

  • sallyr,

    That's option A. It's the 2007 valuation, that's the rub.

    But there's a mechanism (unspecified) for reviewing the valuation if it doesn't stack up.

    Since Jun 2007 • 20 posts Report Reply

  • BlairMacca,

    Either way, it is a shit way for Tower to act, and it should be brought to the media they would love to jump on it I would think

    Wellington • Since Apr 2007 • 201 posts Report Reply

  • Mark Lincoln,

    This is starting to do the rounds on Twitter. I wonder how other insurance company's attitudes will compare to Tower's?

    Nice article mate. Hope things work out for you.

    Christchurch, NZ • Since Jun 2011 • 1 posts Report Reply

  • giovanni tiso, in reply to Mark Lincoln,

    I wonder how other insurance company’s attitudes will compare to Tower’s?

    Yes, it would be good to document the behaviour of State and the rest, since I don't imagine that David and Jen's will be the only claim of its kind.

    And of course my heart goes out to you and your family, David - except insofar as I'm confident it won't end like this. We have your back, as has been said.

    (Also, Tower can look forward to losing our business - house, car, contents - as soon as each contract comes up for renewal.)

    Wellington • Since Jun 2007 • 7386 posts Report Reply

  • David Haywood, in reply to Che Tibby,

    i think BlairMacca is right (lost that point in the red mist after reading your tale). isn’t there some devil in the detail there? the Gubbermint should be paying out the pre-2010 valuation of the house, then taking it up with Tower themselves?

    As Sally said, that’s Option A. Essentially that’s a very approximate book value for the property, but *not* replacement value. But it’s great for lots of people who only insured their house for book value.

    But I’ve been paying for total replacement coverage from my insurance company. So – supposedly – I can take Option B and negotiate directly with my insurer. The only problem is that Tower Insurance are saying it’s repairable, and so they don’t have to pay out for replacement coverage. But if it’s repaired by the insurer (fine by me) then it will be bulldozed in nine months by the government (not fine by me).

    The issue – as I see it – is that Tower are using the red zone declaration to weasel out of the premium policy that I paid for, and – effectively – to foist upon me the cheaper policy that I paid good money to avoid.

    This will also be applying to loads of other people round here as well.

    Dunsandel • Since Nov 2006 • 988 posts Report Reply

  • sallyr,

    You don't have to wait for renewal...

    Really, really awful situation for David and Jen, and so many others.

    Since Jun 2007 • 20 posts Report Reply

  • BlairMacca, in reply to David Haywood,

    Apologies, I now realise your situation David (clearly you can tell I dont own my own house). Ok that really does suck then.

    Wellington • Since Apr 2007 • 201 posts Report Reply

  • David Haywood,

    Nicky Wagner, one of our local MPs, just very kindly phoned me to semi-confirm what I've been told by Tower. The bit that didn't match is that Tower told me that homeowners could only get their replacement policy if the house had already been condemned; whereas Nicky thought that if the repairs exceeded some theoretical book value then Tower *would* have to pay out for replacement.

    At any rate, this still seems outrageous for the homeowners whose houses fall under this theoretical book value.

    Dunsandel • Since Nov 2006 • 988 posts Report Reply

  • Gareth Ward,

    Does Option B involve the Gubbermint buying the land and Tower paying for the building? Or is Option B land and buildings paid out by Tower?

    Auckland, NZ • Since Mar 2007 • 1721 posts Report Reply

  • Gareth Ward, in reply to David Haywood,

    homeowners could only get their replacement policy if the house had already been condemned

    Doesn't "you can't live here anymore and we'll be bulldozing your house" = condemned?!

    Auckland, NZ • Since Mar 2007 • 1721 posts Report Reply

  • Lisa Black, in reply to Che Tibby,

    I agree with Che - make a formal complaint. The complaints process is usually handled by people with a wider perspective than the front line claims handlers and you're more likely to get a result.

    The industry is desperately short of experienced property claims people at present, so this decision was likely made under massive time pressure and possibly by someone either new to the job or unfamiliar with Tower's ethos.

    Try to be patient, if you have any patience reserves left. I suspect that the people involved are working really long hours.

    Hang in there, follow this through til you get the right result.

    Wellington • Since Jul 2010 • 63 posts Report Reply

  • Martin Lindberg, in reply to David Haywood,

    Apart from raising hell about this thru media, your MP etc, I would suggest you raise this with the Insurance Ombudsman. Tower has signed up as participant to this process.

    ETA: You first need to raise a formal complaint with Tower. There is a process to follow described here.

    Stockholm • Since Jul 2009 • 797 posts Report Reply

  • Che Tibby, in reply to Lisa Black,

    this decision was likely made under massive time pressure and possibly by someone either new to the job or unfamiliar with Tower’s ethos.

    i’d wondered the same. i know from working at [redacted. oops] that sometimes, just sometimes, the front line staff are complete fcking idiots who couldn't read a script if it was stapled to their greasy, greasy foreheads.

    just sometimes mind.

    the back of an envelope • Since Nov 2006 • 2026 posts Report Reply

  • Graeme Edgeler, in reply to Che Tibby,

    I'm pretty sure I couldn't read a script stapled to my head.

    Wellington, New Zealand • Since Nov 2006 • 3009 posts Report Reply

  • Che Tibby, in reply to Graeme Edgeler,

    it's in really tiny letters, so it looks like it's on a monitor.

    the blood in your eyes from the staple puncture is the biggest hazard.

    the back of an envelope • Since Nov 2006 • 2026 posts Report Reply

  • jh,

    Maybe I missed this but could you argue that to repair your house you have to move it?

    My fiend has just been red stickered as she is near a Port Hills bowling alley (large rocks) which come down after the biggest quakes. One got a bit close but the house only has cracking. That loop hole might apply to her?

    Since May 2007 • 78 posts Report Reply

  • Rob Stowell,

    Horrible. Hope Tower can be convinced to change its mind. If it has one.

    Whakaraupo • Since Nov 2006 • 1574 posts Report Reply

  • Ross Mason,

    Umm...Have i understood correctly.

    Here is what John and Gerry said yesterday:

    For people who owned property with insurance in the residential red zones on 3 September 2010 there will be two options:

    •the Crown makes an offer of purchase for the entire property at current rating value (less any built property insurance payments already
    made), and assumes all the insurance claims other than contents; or
    •the Crown makes an offer of purchase for the land only, and homeowners can continue to deal with their own insurer about their
    homes.

    Haywoods have insurance, therefore they have the option of taking the Govt deal of buying out at the 2007 ratable value, The WHOLE lock stock and barrle - as far as I understand it - of land and house at the Govt GV.

    If they have made documented improvements with building permits and receipts they can claim the extra.

    Do the Haywoods still lose on the deal???

    ....unless the Chch ratable value is based on land value, not capital value???????

    Upper Hutt • Since Jun 2007 • 1497 posts Report Reply

  • Bart Janssen,

    Well Fuck! Fuck Fuck Fuck Fuck Fuckity Fuck

    And you have my deepest (hug-free of course) sympathy.

    Auckland • Since Nov 2006 • 3417 posts Report Reply

  • Ian MacKay,

    This might be a good time to reexamine the fine print for just what is meant by "replacement value" regardless of where we live. There seem to be rumours around that the replacement may depend on other factors and not just the floor area.
    Good luck David with your issue.

    Bleheim • Since Nov 2006 • 498 posts Report Reply

  • Fooman, in reply to Ross Mason,

    Do the Haywoods still lose on the deal???

    Yes, because they lose the aesthetic value (that they had a great deal of investment in) of their particular house.

    Imagine having a nice 1971 Ford Falcon GT-HO ( with a certain desirability or intangible value) and insuring for full replacement. Shit happens, and the insurance company offers a 2011 XR8 instead, take it or leave it ("what, they're both Ford V8's! What's the problem?)

    FM

    Lower Hutt • Since Dec 2009 • 87 posts Report Reply

  • Isabel Hitchings,

    Fucking fuck - I'm so sorry guys. I hope you manage to make a good sized stink and get fair treatment quickly.

    And if this shit is happening to you guys then it'll happening to plenty of others who may not be as informed, articulate or connected as you are :-(

    Christchurch • Since Jul 2007 • 706 posts Report Reply

  • webweaver,

    It’s not just Tower. I’m currently on the phone with ASB, with whom I have my home (full replacement) cover. They are saying the exact same thing.

    If my home was repairable and the cost of repair was less than the cost of rebuild, EVEN IF I WAS IN A RED ZONE they would only pay for the cost of repair.

    When I sarcastically asked if they would pay out for the full cost of replacement once the house had been bulldozed, she went away to ask an expert and came back with the same answer. No.

    When I pushed the point and asked how on a practical level it is possible for them to claim that a house can be repaired when the land beneath it is no longer deemed liveable and the whole suburb is being written-off, she told me that it wasn’t the insurance company’s problem – because they don’t insure the land.

    Un-fucking-believable.

    She thinks it will be the same attitude across the board with all insurance companies.

    Anyone else want to get in touch with their insurance company and find out if it is the same with all of them?

    David - my heartfelt sympathies to your and your family. I'm hoping that with your connections, this issue can be massively publicised and debated and that insurance companies will be forced to change their approach. They make billions of dollars a year in profits. This is morally indefensible.

    Wellington • Since Nov 2006 • 329 posts Report Reply

  • Ben Gracewood, in reply to webweaver,

    When I sarcastically asked if they would pay out for the full cost of replacement once the house had been bulldozed, she went away to ask an expert and came back with the same answer. No.

    So it really does sound like this is part of the "deal" that has been struck between Govt, Insurers and Reinsurers. "We pay for write-offs, but only for repairs on forced relocations".
    Not cool at all.

    Orkland • Since Nov 2006 • 167 posts Report Reply

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