The ongoing series of earthquakes since September 2010 had a profound impact on AMI and its Canterbury customers. As a result of the unprecedented cost of earthquake claims, in April 2011, AMI received capital support from the New Zealand Government to ensure the interests of all AMI policyholders were protected and all claims would continue to be met under the terms of their policies.


On 5 April 2012 AMI separated into two companies:

  1. Southern Response - the new company name for AMI's former earthquake claims management team. Southern Response is a Government-owned company. Southern Response is also financially responsible for a small number of claims resulting from events occurring before today, such as the recent Nelson floods and some snow damage claims, which were not part of IAG's purchase of AMI (although these claims continue to be managed day to day by AMI).
  2. AMI Insurance - this 'new' AMI company is now owned by IAG as of separation on 5 April 2012. It kept the AMI name and logo and continues to provide day to day insurance. AMI is responsible for all claims for any damage (including earthquakes) which occur after 5 April. 

AMI policyholders with earthquake-related claims continue to be customers of both the 'new' AMI and Southern Response until their earthquake claim is settled.

Claims Responsibilities and Funding

As at 5 April 2012, Southern Response is responsible for settling an estimated $1.5 billion in earthquake claims involving:

  1. Just over 11,000 claims to 6670 Canterbury properties where damage exceeds EQC's $100,000 plus GST 'cap' for an earthquake event
  2. Nearly 22,000 'out of scope' claims, for damage to paths, driveways and other external structures, which are not covered by EQC
  3. Around 3,000 temporary accommodation claims, which are not covered by EQC
  4. Around 1,500 other claims including contents, loss or rent and motor vehicle

Some AMI policyholders are entitled to a cash settlement option while others have their house repairs/rebuilds managed by Southern Response's project manager, Arrow International. Current estimates indicate this work will involve Southern Response being responsible for the rebuild or repair of over 6500 homes.

Southern Response will firstly use the available reinsurance cover AMI had in place for each earthquake event to settle earthquake claims. Additional funds will come from retained capital from the sale of AMI to IAG and other retained assets.

Southern Response also has funding available from the Government if required to ensure every earthquake claim it is responsible for is fully settled under the terms of the insurance policies.

As claims are settled progressively, Southern Response will gradually wind down and then close.

Ownership Structure and Governance

Southern Response is a Crown-owned company with a Board of Directors appointed by the Crown as sole shareholder.

Southern Response is incorporated under the Companies Act 1993 and is listed in Schedule 4A of the Public Finance Act 1989. The company's shareholders are the Minister of Finance and the Minister of Earthquake Recovery.

Company Information

The company traded as AMI Insurance Limited until 5 April 2012, when the Crown took control of the company, changed its name to Southern Response Earthquake Services Limited and sold all of its non-earthquake related business to IAG (NZ) Holdings Limited.

The company's financial statements to 30 June 2012 record the full year results for its continuing operations (management and settlement of claims from the Canterbury earthquake events) plus its discontinued operations (writing of fire and general business for the domestic property insurance market) up to 5 April 2012.