Consultation open for proposal to improve access to insurance dispute resolution schemes

Commerce and Consumer Affairs Minister Paul Goldsmith today announced the start of public consultation for a proposal to make dispute resolution schemes more accessible for homeowners in dispute over insurance claims.

“We are considering making dispute resolution schemes more accessible by increasing the compensation cap from $200,000 to $350,000 for property insurance disputes,” Mr Goldsmith says.

“Under this proposal, dispute resolution schemes will be able to consider cases where the insurer and the customer are seeking to resolve a claim discrepancy of up to $350,000.

“Currently disputes over $200,000 must be referred to the High Court, which many people may not be able to afford.”

“Dispute resolution is an independent, less formal and cheaper alternative to the Court system.”

“This proposed change would enable more effective and faster resolution of issues, and in particular should help move forward some of the unresolved disputes in Canterbury.

The public will have until 9 April to submit on the proposal, with any resulting increase in the compensation cap being made in mid-2015. Anyone with a dispute dating back to August 2010 will be able to take advantage of this change.

“The upcoming review of the Financial Advisers Act and Financial Service Providers Act will provide the opportunity to consider the role of the dispute resolution schemes and their jurisdiction more broadly,” Mr Goldsmith says.

For more information visit: http://www.med.govt.nz/business/business-law/current-business-law-work/approved-dispute-resolution-schemes-minimum-compensation-cap-for-insurance-disputes/