Riskpool’s withdrawal of cover will be managed

  • Maurice Williamson
  • Chris Tremain
  • Gerry Brownlee
Local Government Canterbury Earthquake Recovery Building and Construction

The Government has today been informed by the Christchurch City Council that its professional indemnity and public liability insurer Riskpool has withdrawn cover effective 1 July for claims which may arise under the Building Act 2004.

Canterbury Earthquake Recovery Minister Gerry Brownlee says Riskpool’s move is no surprise.

“Today’s move means that if the council is negligent in performing its functions under the Building Act leading to defects in building work, any liability owed by the council will need to be met from its own funds.

“This is a reasonable action on Riskpool’s part, and stems entirely from Christchurch City losing its International Accreditation New Zealand (IANZ) accreditation as a Building Consent Authority,” Mr Brownlee says.

Local Government Minister Chris Tremain says today’s news further reinforces the council’s decision to request a Crown Manager be appointed to take over the council’s Building Consent functions.

“The Crown Manager’s focus on performance improvements will be crucial to providing confidence to the insurance sector as well as Christchurch ratepayers,” Mr Tremain says.

Building and Construction Minister Maurice Williamson says the Government would expect the Christchurch City Council to have the capacity to absorb any liabilities which may arise as a result of Riskpool’s decision.

“Early advice suggests the number of successful claims against building functions is likely to be small and well within the council’s capacity to cover,” Mr Williamson says.