What if I have concerns about how my Package Payment offer has been calculated?

If you have received a Package offer from Southern Response and have concerns about how it has been calculated, you may request a review of your offer within 20 working days of receiving it.

You can request a review of the offer if you have any concerns about:

  • how the Package principles have been applied to the policyholder's original cash settlement with Southern Response, and/or
  • how the Package offer has been calculated.

Complaints about the scope of the Package or any other aspect of Package design are unable to be considered under the Package Review Process.

For more information about the Package Review Process, please click here.

What is APLY ID?

APLY ID is a New Zealand founded company designed to allow customer ID verification on a secure platform. It is used by many of New Zealand's largest businesses.

Once a customer has completed their ID verification, APLY ID will run some background checks on the provided document/s. It is checking the document is verified with the appropriate agency (eg. Department of Internal Affairs or NZ Transport Authority) and that all the details are correct. The system will also complete a biometrics check to measure the customer's face and match it to the photo on their ID. 

APLY ID uses world leading security technology to ensure customers' information is kept safe. All of the customers details are kept in the secure platform and no details are saved to any device. Once the ID verification has been completed, the report is permanently archived. APLY ID and Southern Response will never be able to access this information again. 

APLY ID is our preferred way to verify customers as it is fast and secure, however, if a customer does not wish to be verified via APLY ID they can do a manual ID verification instead.

What has come of the Ross representative proceeding?

A representative action was brought against Southern Response by Brendan and Colleen Ross as plaintiffs on their own behalf and on behalf of all persons who are “class members" as defined by orders made by the Court of Appeal in Ross v Southern Response [2019] NZCA 431.  On 16 December 2021 the High Court granted leave to discontinue the Ross representative action ([2021] NZHC 3497) and the plaintiffs have subsequently discontinued the representative action.  As a result, there is no longer a requirement to opt-out of the representative action before the Package payment is made.  

What types of AMI insurance policy are eligible for this payment package?

This package broadly covers Southern Response cash settled insurance claims.

The AMI policies included in the Package are:

  • Premier House Policy
  • Premier Rental Property Policy
  • Market Value House Policy
  • Market Value Rental Property Policy

Why are Southern Response managed repairs and rebuilds excluded from the package?

If your claim was settled through a Southern Response managed repair or rebuild, Southern Response paid for all actual rebuild costs as they were incurred (including any variations that arose during the rebuild process, which would be paid for using the contingency sum). Therefore there are no unpaid professional fees or contingency amounts.

Why are cash settlements after 1 October 2014 not included in this package?

The Package is focused on cash settlements prior to 1 October 2014 because policyholders who cash settled with Southern Response after October 2014 have received professional fees and a contingency sum already.

What is the Independent Oversight Committee (IOC)?

The Government has established an Independent Oversight Committee (IOC) to supervise the rollout of the Package.

For more information about the IOC, please click here.

How will you calculate the payments under this Package?

In general terms, calculating Southern Response's offer to you under the Package begins with calculating the professional fee and contingency amounts applicable to your individual settlement under the Package. These amounts will be:

  • For professional fees, a figure representing at least 6% of the base construction cost for the rebuild or repair of your property; and
  • For the contingency sum, a figure representing at least 10% of the base construction costs plus professional fees as calculated.

You may be eligible for a higher allowance for professional fees or contingency if a higher allowance was provided for in the DRA held by Southern Response (often referred to as the "Internal DRA"). The DRA, or Detailed Repair/Rebuild Analysis, was a scope of works document prepared by Southern Response's agent Arrow.

Interest will be calculated on the total of the professional fee allowance and contingency sum. The total of professional fees, contingency sum and interest will be the gross (or preliminary) calculation.

In calculating our offer, we will need to deduct amounts we have already paid you for professional fees and/or contingency in your original settlement.

We will also need to account for any matters particular to your insurance policy and/or original settlement, such as:

  • where the relevant policy had a specified maximum sum insured;
  • where you elected to take a cash settlement for the depreciated market value of your property, or
  • where shared property was involved (such as a shared fence or driveway).

Matters such as these may reduce or eliminate our offer under the Package depending on the particular detail and circumstances of your previous settlement.

There are many variations in the application of these basic principles to reflect circumstances relevant to each case and this is a broad outline only.  Any offer of payment that we make to you will set out how we have calculated our offer. You will be able to take this information and seek professional advice, and we strongly encourage you to do so.

You should also take advice about your GST and tax obligations.

Example - This is a general example only. The offer to each policyholder is subject to calculation and review of the specific circumstances, including how the claim was originally settled. All figures in this example are GST inclusive.

The base construction cost for Mr and Mrs Smith's house rebuild was $500,000, which was disclosed in their DRA. The Internal DRA for their property (not disclosed) had an allowance for professional fees of $40,000 and an allowance for contingencies of 8%. Mr and Mrs Smith settled their insurance claim with Southern Response on 1 July 2013 for $500,000.

The professional fee allowance for their property under the Pre-October 2014 Payment Package is 6%. The contingency allowance is 10%.

Professional fees, being the higher of either:
  • the amount in the Internal DRA = $40,000; or
  • 6% multiplied by the base construction cost ($500,000), being the minimum % for professional fees as part of the Package = $30,000
Contingency sum, being the higher of either:
  • the 8% allowance in the Internal DRA multiplied by the base construction cost plus professional fees ($540,000) = $43,200; or
  • 10% multiplied by the base construction cost plus professional fees ($540,000), being the minimum % for contingency as part of the Package = $54,000
 Subtotal  $94,000.00
Apply interest to the subtotal ($94,000) using the Ministry of Justice Civil Debt Interest Calculator from date of original settlement (1 July 2013) to date of Package settlement (2 March 2021, for this example)  $27,740.24
Total $121,740.24


Why are you making deductions to my calculated payment?

It will be necessary to make deductions in some circumstances to ensure the same costs are not paid twice, and to ensure any payment is within the parameters of your insurance policy. For example:

  • Some costs may already have been paid or delivered to customers at the time they settled their claim, such as when professional fees were expressly negotiated as part of the original settlement.
  • Customers who originally took a market value cash settlement offer under a Premier policy will have their package payment depreciated by the same percentage the independent property valuer applied to the original settlement.
  • A stated sum insured should not be exceeded, so package payments should not be made beyond any monetary stated sum insured (ie a policy cap). This means payments may need to account for the monetary sum insured under the relevant AMI policy.