The Government could face further earthquake costs following a declatory court judgement which found the Earthquake Commission is liable to cover multiple disaster claims on one property.
On Friday, the Wellington High Court considered whether the EQC would cover multiple claims on a property damaged by more than one quake.
All residential buildings and contents which have fire insurance are covered by EQC for up to $100,000 for the building and $20,000 for its contents, plus goods and services tax (GST).
The High Court found that as long as a residential property had fire insurance, claims to EQC for damage up to the $100,000 level could be made for each natural disaster which caused damage to the property.
About $6 billion has been built up in the Natural Disaster Fund which EQC manages.
Earlier this week, the commission more than doubled its initial estimates of how much it will have to pay out for the Christchurch quakes to $7 billion.
However, the shortfall will be met, as the commission has a Government guarantee which ensures it will always be able to meet its obligations.