Advice from the Insurance Council of New Zealand, is that as of 1st of July, one of the country’s top insurers, Vero, will align its policy response for meth residues with the numbers included in the Gluckman Meth Report. It should be anticipated that other insurers will follow.
Changes will be introduced for new policies and those that are renewing after 1 July. So, it will take a wee while to work its way through the system.
Gluckman Report a de facto standard
This action on the part of the insurance industry is understandable. If it works for Government agencies, why should they tie their insurance policy response to Standard that has been undermined by government policy?
What it does, is reinforce the impression that the standard has changed. This despite the fact that it has not and the authors of the Gluckman meth report noting it was never meant to form the basis of a new Standard.
What does this change mean for policy holders?
What this will mean, is that in the absence of evidence of manufacture, Vero Policy holders should expect insurance cover to kick in after individual samples exceed 15µg/100cm2. Police find a fraction of the labs that operate and evidence of manufacture is typically cleared away. So, a policy holder should expect the new response threshold to be in line with Gluckman’s recommendations.
Decontamination to below 1.5µg/100cm2 should follow. But, the details of how policies will respond will be determined on a case by case basis.
The costs associated with decontamination from these higher levels, is typically greater than when the levels in the Standard are exceeded. So, while the number of admissible claims will reduce, the quantum of these claims is likely to increase.
In all likelihood, this will mean that property owners wear more of the financial costs associated with damage resulting from meth related behaviour.
What can I do about this?
Check the wording of your policy of insurance and your renewal date.
If you are insured directly with the insurer, there is very little you can do.
If you are insured through an insurance broker, speak to them about what approach your insurer will take at the next renewal. They may have more leverage to resist this change for the policy wordings they supply.
Either way, before your policy renews and the change comes into effect, consider checking the meth status of your property. If there is an issue that needs resolving, is it better to use insurance you have bought and paid for or wait to find out later and carry the cost yourself?
Call our team on 0800 638 452 to find out how we can help