Six out of seven IAG repairs found to be deficient in Govt investigation

Tuesday, 25 August 2015

Six out of seven quake repairs by insurer IAG were found to be deficient in a Government investigation.

IAG, which along Southern Response holds the most Canterbury earthquake claims, says it is concerned by the findings and will review hundreds of unconsented foundation repairs.

The Ministry of Business, Innovation and Employment (MBIE) last week released a report following a survey of 90 Canterbury homes, which found a third of quake repairs failed to meet the Building Code. A further 23 had defects.

Most of the homes surveyed had had Earthquake Commission (EQC)-managed repairs (74).

The investigation also included 15 insurer-managed repairs – seven of which were managed by IAG and eight by Southern Response.

Most of the IAG-managed repairs were deficient: three did not comply with the building code and three had 'minor defects'.

All the Southern Response repairs complied with the code and one repair was found to have minor defects.

Most of the faulty work involved unconsented foundation work.

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Following the report, EQC announced it would recheck 3600 houses and estimated 1200 would need more repairs.

Insurers are also promising to check their unconsented structural repairs.

IAG spokeswoman Renee Walker said the company was concerned by the survey's findings and recognised homeowners would be too.

IAG was working with its project manager, Hawkins, and the builders involved in repairs to address quality and management processes.

'We expect workmanship that is up to standard, as do our customers,' she said.

'We will work with our customers to ensure that any non-compliance is addressed.'

An independent building surveyor was looking at 20 houses randomly selected from about 800 completed repairs.

She could not say how many of the 800 completed repairs had been done without a consent.

A miniature robot camera would also inspect hundreds of piled homes foundations to check hundreds of repairs done by IAG contractors.

If deficient repairs were found, homeowners would have to resolve the matter with their builder as IAG was not party to the contract between the builder and homeowner, Walker said earlier this month.

A spokeswoman for Southern Response said the company was 'pleased with our result of zero non-compliant defects in the MBIE survey'.

'This is a testament to the quality assurance, training and monitoring in our programme.'

However, the company was 'not resting on our laurels' and regularly reviewed current and completed work to ensure compliance and best practice.

A multi-terrain miniature robot camera, Rover, had started assessing damage beneath houses with suspended timber floors in 2013.

Rover was also used to inspect the quality of completed work.

It had conducted over 1,100 inspections so far and the company was reviewing 200 timber floor foundation repairs completed to date.

Southern Response had completed 481 over cap repairs so far, a further 138 were in construction and 497 were in the design phase.

Of the 481 completed repairs, 39 were exempt from requiring a building consent early in the programme.

Southern Response had decided at the end of 2013 to 'stop that practice' and get a building consent for all its structural repairs.

'We wanted customers to have greater assurance that their repair work was compliant.'

The Insurance Council of New Zealand (ICNZ) said it expected members to review and follow up on the recommendations if necessary.

Chief executive Tim Grafton said the majority of insurer managed repairs and rebuilds required consents and inspections, so the potential number of affected homes would be 'a very small percentage'.