Winners and losers from Chch insurance court ruling
Canterbury property owners have won a crucial court judgment confirming they have first rights to $33 million of reinsurance money from failed insurer Western Pacific.
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Canterbury property owners have won a crucial court judgment confirming they have first rights to $33 million of reinsurance money from failed insurer Western Pacific.
But the news is not good for creditors with non-earthquake-related claims and other trade creditors owed about $20 million. And nor is it likley that the earthquake victims covered by Western Pacific receive a full payout on their policies.
The Queenstown-based Western Pacific was placed in liquidation after being swamped with claims relating to the Christchurch earthquakes.
Latest estimates from the liquidators revealed the company owes creditors $63.5 million, about $40 million of which resulted from the February and September earthquakes.
Liquidators Simon Thorn and David Ruscoe of Grant Thornton sought direction from the High Court on whether the reinsurance funds could be made available to all creditors.
Justice Simon French ruled that the Canterbury policyholders held first charge over the proceeds of the reinsurance, which was triggered by a catastrophic event.
While a win for the Canterbury quake victims they are still likely to be out of pocket from their insurance given that the $33 million will not satisfy their total claims.
Duncan Bridgeman
Tue, 13 Dec 2011
Tue, 13 Dec 2011
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Winners and losers from Chch insurance court ruling
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