Monday, September 19, 2011

Fixing Christchurch

Today Labour released its earthquake recovery policy. Where National's "plan" is to basically sit back and let the market fix Christchurch, Labour seems to recognise that the market isn't working. Refusal to provide insurance is preventing rebuilding, while blatant price gouging is preventing Red Zone inhabitants from relocating within the city, basically forcing them to leave. Labour plans to tackle this by threatening to intervene in the insurance market (the AMI bailout gives them an excellent vehicle for doing so), and promising to compulsorily acquire land to provide new sections for affected residents. These are good policies, and while they will cost more in the short-term than the government's present strategy, it will be worth it. Christchurch is too important to do on the cheap.

Meanwhile, one of their other policies - an independent insurance commissioner to resolve disputes - is a great idea, but will probably come too late. Realistically, it will be two more years before such an office could be established and working. Even if it had jurisdiction over past disputes (which it may not), lack of money will have forced a settlement to most disputes long before then. But it will help in the longer term to prevent the insurance industry from reneging on its customers ever again.