The Labour Party says it would require homeowners to pay Earthquake Commission levies through their rates, to ensure everyone is covered in a disaster.
[image:3578:third:right]Labour leader Phil Goff on Wednesday released changes to the party's Earthquake Commission policy in the eastern Christchurch suburb of Bexley.
Under the policy, Labour would make Earthquake Commission coverage universal by using the rates system to collect levies from all homeowners based on the value of each property.
Labour would also increase the $100,000 cap on Earthquake Commission cover, in consultation with the insurance sector.
Mr Goff says the sheer scale of the Canterbury earthquakes has severely tested the Earthquake Commission, the Natural Disaster Fund is depleted and the system must be reformed to secure its ability to respond to future disasters.
"If we've learned anything from the huge scale of this disaster (it's) that we need a fund that everybody contributes to, everybody carries their fair share of the load and everybody is protected at the time that there's a natural disaster."
The Labour leader says the policy would be simple and fair, and eliminate the moral hazard of covering uninsured homeowners, which penalises people who pay for private insurance.
Labour's earthquake recovery spokesperson, Clayton Cosgrove, says with the Government taking on more risk, private insurers would be expected to look at their premiums.
"What we have to do is go in there and say 'how to we kick-start insurance?'.
"There is going to be economic and social carnage in this province if we can't get insurance rolling again both from a residential point of view and a business point of view."
But National's earthquake recovery spokesperson, Gerry Brownlee, is questioning whether the entire system should be changed when so few people are uninsured - in the case of Christchurch less than 3%.
And Mr Brownlee says linking the amount of levy with a property's rateable value is fundamentally unfair, while the move would also be a big impost on local authorities who would have to collect the fee.
