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When the Shaking Stops

Residents of Christchurch, the second largest city in New Zealand, continue to have sleepless nights and worry-filled, emotional days as the aftershocks keep coming – nearly a week after a 7.1 magnitude earthquake struck at 4:35am on Saturday, September 4, 2010.  Apart from all the shaking, there’s also the worry about the amount of time and money needed to repair or rebuild damaged houses and businesses and fix everything in general (roads, water supply, and other infrastructure).   However, there seems to be a lot of positive talk as well – about the fact that no one died and there were very few serious injuries as a result of such a big earthquake, about how everyone in the community has pulled together, and about how well the local and central governments (and the various agencies) have responded to the disaster.

There are even positive things being said about some of the laws in place, particularly the rules that helped ensure that damage to buildings (and therefore the number of injuries and deaths) wasn’t as bad as it could have been.  New Zealand is also one of the few countries in the world to have a government-managed natural disaster insurance system, and this  means the majority of people will receive money to help them rebuild.

New Zealand basically straddles the Australian and Pacific tectonic plates.  The movement of these plates means that around 14,000 earthquakes are recorded each year, with between 150 and 200 big enough to be felt.  (The biggest recorded earthquake in New Zealand occurred in 1855 in the Wairarapa region – where I’m from – and was an 8.2 magnitude.  You can definitely see evidence of where the ground was pushed up throughout the area.)  It therefore makes sense for people to live in houses, and work in buildings, that can withstand a good amount of shaking.  Changes to the building laws started reflecting this back in 1931 following a major earthquake that destroyed much of Napier and Hastings, killing at least 256 people.  The current Building Code contains the performance standards that must be met for all new buildings, including in relation to structural stability.  While many homes have been affected by the quake, it appears that Christchurch’s historic, mainly brick, buildings (built before any Building Code was in place) suffered the most extensive damage, and sadly some of these will need to be demolished.

The Napier earthquake also gave rise to discussions about the need to extend the existing practice of insurance companies funding fire brigades to also include post-earthquake restoration.  The law that eventually passed in 1944 included this concept, as well as that of war damage funding that had arisen as an issue during World War II.  This law established the Earthquake and War Damage Commission, which has since been amended to just being the Earthquake Commission.

I remember finding out about disaster insurance from reading my old insurance information in New Zealand.  Basically, what it said was that my private insurance company was required to pay an amount from my premium to the Earthquake Commission, and that if there was an earthquake (or other natural disaster – tsunami, volcanic eruption, etc.) I’d be able to make a claim for up to NZ$20,000 (about US$14,500) for my belongings, and NZ$100,000 (about US$72,650) for damage to any residential property that I owned.   I’d need to lodge a claim with my insurance company for any amount above these figures.

The Earthquake Commission says it has so far received 34,000 claims from Christchurch residents, and expects many more to come.  It has a fund of about NZ$5.6 billion (about US$4 billion), which is also backed by a government guarantee, so it will be able to meet all of its obligations to insured people.  Of course, there are a number of uninsured people (maybe about 5,000 homes), and the government has said it may provide some help to those that show “true hardship.”

The situation is going to remain stressful for quite a while longer, and there is a lot more work to be done by individuals, businesses, building inspectors, engineers and builders, central and local government, the Earthquake Commission, and insurance companies (who have also said they will be able to cope with the claims).  But I think it is worthwhile noting that laws and regulations do have a part to play in making things easier (or at least better than they might have been) for people when there is such a terrible event.  I hope that the people of Christchurch are able to get back some sense of normality soon.

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