Claims can be made on flooded carpets

Press, Volume CXIV, Issue 33541, 23 May 1974, Page 14

Claims can be made on flooded carpets

Any carpets covered by fire insurance which were damaged in the April flooding in Christchurch can successfully attract compensation for the flood damage.

This ruling was contained in a letter from the Minister in Charge of the Earthquake and War Damage Commission (Mr Fraser) to the Mayor of Christchurch (Mr N. G. Pickering).

Mr Pickering had sought a ruling on behalf of residents

whose damage claims had been refused by the commission.

Mr Fraser said any property covered by a fire insurance automatically attracted the additional insurance benefits provided under the Earthquake and War Damage Act. “Property which is not insured for fire damage cannot be sustained as a claim under the act,” he said.

“You indicate the reason which has been advanced by assessors (acting for the commission) for unsuccessful carpet damage claims is that claimants did not have a ‘comprehensive’ policy. This type of policy, known as a houseowner’s policy on a building or a householder’s policy on the contents of a building, includes cover for flood damage. Glued or not “In such cases the claim would fall on the fire insurer and not on the commission. A liability will fall on the commission only when the fire policy does not extend to include flood cover, or when the flood cover under the fire policy has been exhausted,” said Mr Fraser. It had also been mentioned that claimants had been advised that damage to carpets would be accepted as a claim only if the carpets were glued to the floor.

“From my inquiries it does appear that these unsuccessful claimants did not have a policy specifically covering their carpets, but were seeking indemnity for carpet damage under a policy covering the building,” said Mr Fraser. “The commission has no control over the issue of a contract for fire insurance which automatically attracts cover under the act. The commission must therefore follow accepted insurance practice, and apply the same principle as adopted by fire insurance underwriters,” he said.

This practice was that carpets and other floor coverings were essentially part of the contents of the building and were normally insured as such.

Only when floor coverings were cemented or glued to a floor did insurers accept them as forming a part of the building for the purpose of a claim, he said.

No quibbling “If floor coverings are not otherwise insured, the com-: mission follows the accepted insurance practice and will! treat the carpets glued or cemented to the floor as being I insured under the building policy.” Thus, anything covered by a fire insurance is eligible for

flood insurance, either under the fire policy itself or from the Commission. If the fire policy covers only the building, however, floor coverings are not eligible for flood coverage unless cemented or glued to the floor. “I feel you must agree that in determining liability under the act, there can be no suggestion of legal quibbling by, assessors,” said Mr Fraser, I “The carpets are either insured or not insured. But, if they are insured, a claim' arising from this flood must succeed, with the insurer if the fire policy does extend to include flood damage, and with the commission if it does not,” he said.