QUAKE DAMAGE

Dominion, Volume 38, Issue 4, 29 September 1944, Page 6

QUAKE DAMAGE

Minister’s Explanation

Of Bill REINSURANCE ASPECT There had been 73 earthquakes in 142 years in New Zealand, an average ot one every two years, said the Minister of Finance, Mr. Nash, when moving the second reading of the Earthquake and War Damage Bill in the House of Representatives last night. There might be suggestions that certain parts of the country were less liable to such risk than other parts, but there was not much evidence to support that over a long period. Certainly some areas were known to be more susceptible than others, but it was not possible within the limits of existing scientific knowledge to say what areas might not suffer. The time might come when earthquakes could be foretold with accuracy. . .. Statistics of the damage, costs of earthquakes within the Dominion were given bv the Minister as followslB4B, £30,000; 1858, £70,000; the Hawke B Bay earthquake of 1931, 5,000,000; the Wellingtoii-Wairarapa earthquake, £2,000,000. These were small in comparison with Siin Francisco, 1906, which cost £80,000,000. The big earthquake in Tokio and Yokohama _in 1923 caused damage estimated at £550,000,000. The main principles which had actuated the writing of the measure were that earthquake losses were national and consequently cover had been made compulsory and had the backing of the State. Funds were available from the War Damages Bill of 1941, for which. the amount collected had been £4,086,268, and the claims paid out had totalled only £lO6B/3/10. , . . u The important point that justified the Bill was the large percentage of people who were never covered against eorthquake damage. The losses in the 1942 quake were terrific. The extent to which many people were willing to let such cover go by was to be seen in the unrepaired buildings in some areas. The price asked for reinsurance was so high that it was not proposed to take it at present, said the Minister. He thought this was a wise decision, otherwise the Government might have to pay out more than it received in premiums. There was, however, a case for reinsurance overseas because it was overseas that we would require to have credit, for goods to repair the damage that might be incurred in the event of disasters. At the same time he could understand insurance underwriters not wanting to recover, because tbe risks were so unpredictable. The underwriters had charged high prices to secure themselves. _ The Minister’s speech was interrupted by the adjournment.