It's been nearly half a decade since the Canterbury earthquakes struck, but for many businesses across the area, it has taken this long to get back onto their feet.
A report on the earthquakes issued by the Reserve Bank of New Zealand (RBNZ) shows that although the local economy has been "quite resilient", there have nevertheless been ramifications for the wider markets. Some industries were worse-affected than others, as the manufacturing sector was largely untouched, while the impact to goods exports and industrial production was relatively short-lived.
The RBNZ noted that most of the damage was focused around Christchurch city. This area alone is responsible for 8 per cent of the country's gross domestic product, so understandably, there was a need to get businesses back up and running as soon as possible.
The financial impact
Estimates from the Reserve Bank show that based on 2011 prices, it would cost around $20 billion to repair and replace damaged assets. This is the equivalent of 10 per cent of annual domestic output. Commercial damage alone was valued at $4 billion, while infrastructure repair and replacement was expected to be in the region of $3 billion.
Statistics New Zealand noted that many companies showed their ability to bounce back in the wake of the earthquakes. This largely took place in 2012, when significant construction work got underway across the region and business operations started to pick up once more.
The organisation revealed that by September 2012, as much as $603 million of building work was in progress in Canterbury, marking a 46 per cent rise from two years earlier. Further to this, more than $3.9 billion of building consents were given the go ahead between September 2010 and December 2012.
Canterbury earthquakes from an insurers' perspective
Many business insurance companies are still finding themselves dealing with and settling claims related to the Canterbury earthquakes. The latest figures from the Insurance Council of New Zealand show that 75 per cent of cap residential claims have now been resolved or entirely settled.
The Insurance Council estimates that over $15 billion has been spent on settling commercial and residential claims related to the natural disaster.
For many home and business owners, the challenge is now whether to accept the insurance pay out they have been offered or to pursue their claim further. Insurance Council Chief Executive Tim Grafton explained that every effort is being made to ensure Canterbury residents are able to access the money they need to rebuild their livelihoods.
Here at Rothbury, we offer tailored business insurance packages to help protect you against a range of problems. Make sure you contact us to discuss your needs in greater detail.
About the AuthorName: Greg Greenwood
I'm the South Island Operations Manager at Rothbury Insurance Brokers and live in Christchurch. I have a portfolio of commercial clients, many who have been my clients for years. My experience of earthquake claims and issues is called…
I'm the South Island Operations Manager at Rothbury Insurance Brokers and live in Christchurch. I have a portfolio of commercial clients, many who have been my clients for years. My experience of earthquake claims and issues is called upon frequently to assist clients and those needing insurance advice in the region. I am also the Chairman, Canterbury region for IBANZ (Insurance Brokers Association NZ).Close