Quake causing problems with property settlements

9:31 am on 17 September 2010

The Law Society says the Canterbury earthquake is creating problems with property settlements.

The society's property law section says the banks lending to people in the process of a property purchase require the property to be insured.

But insurance companies are reluctant to insure Canterbury properties at present, with some adopting a stand-down period of 21 days from the time an insurance policy is written.

This is affecting people who have committed to buying a property and the vendors who, in many cases, have also made arrangements to move on.

The Law Society recommends anyone considering buying or selling a property at present consult a lawyer, as additional clauses may be required in the contract.

The society wrote to Government ministers on Friday asking them to intervene by, for example, underwriting the transitional period. It says the Government is yet to respond.