When our previous issue of Cover to Cover went to virtual-print, COVID-19 had just arrived in New Zealand and the world was beginning to grapple with the economic impact of a pandemic. Almost three months later, New Zealand has eliminated COVID-19 and a number of legislative changes have been made to help promote businesses’ recovery in the new economy.
In this edition of Cover to Cover, we look at several of the legislative changes made to address concerns of widespread liquidations, such as the “safe harbour” provisions and business debt hibernation regime. We look at the impact of these regimes on directors’ notification obligations under their insurance policies and the D&O insurance market more generally.
We also consider the impact of COVID-19 on business interruption insurance and the proposals that have been made by foreign legislators to require insurance companies to pay out business interruption claims for COVID-19 losses. While legislation currently limits the grounds on which insurers may reject claims, it is highly unusual for legislation to retroactively require insurers to pay out claims that are excluded under policies that were entered into before the legislation comes into effect.
We review the new Fair Insurance Code and provide an update on the status of financial services legislative reforms, which have been delayed by COVID-19.
Finally, we cover a recent decision of the Canterbury Earthquakes Insurance Tribunal which provides guidance on the Tribunal’s approach to determining earthquake damage and repairs to an “as new” policy standard. Interestingly, the Tribunal also awarded general damages against an insurer on the basis that aggressive behaviour towards a policyholder breached the insurer’s duty of good faith. This serves as a reminder for insurers to ensure that their communications with policyholders remain professional.
This issue contains six digital articles. Follow the links below to read each one.
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