Ridgecrest v IAG – Insurance & Multiple events


In the case of Ridgecrest New Zealand Ltd v IAG New Zealand Ltd [2013] NZCA 291 the Court of Appeal considered a claim by an insured for damage that occurred in four separate earthquakes all within the one insurance policy period.  The property was damaged by successive earthquakes and eventually damaged beyond repair.  The sum insured was $1,984,000 which was greater than the cost to rebuild the building.  The insured claimed it was entitled to the estimated cost of all repairs.   The insurance company said that it was only liable for the costs of repairs undertaken and the maximum amount payable for any one happening was $1,940,000.  The Court of Appeal decided that IAG was only liable to pay the cost of repairs actually carried out after each earthquake plus the cost of a replacement building up to the maximum policy limit.