Increased Flooding Vulnerability (IFV) land damage

What is Increased Flooding Vulnerability land damage?

Increased Flooding Vulnerability (IFV) is a type of land damage recognised by EQC. In some parts of Canterbury the earthquakes caused changes to residential land which means some properties are now vulnerable to flooding where previously they were not. Also some properties are now more likely to experience a greater depth and/or frequency of flooding. However, it is important to note that Christchurch is a flat, low-lying city and there have always been areas prone to flooding.

 

 

The above diagram shows how ground subsidence from the Canterbury earthquakes has made some properties more vulnerable to flooding.

EQC covers IFV damage to insured land only. The insured land is the land within the property boundary which is:

  • under the house and outbuildings (for example, a garage or a shed);

  • within eight metres of the house and outbuildings; and

  • under or supporting the main access way from the boundary, up to 60 metres from the house and outbuildings.

How does a property qualify for IFV?

EQC uses engineering assessments and reviews as well as valuation assessments to see whether the insured land qualifies for IFV land damage. The insured land must qualify under both the engineering and valuation assessments for a property to have confirmed IFV land damage. This is because IFV land damage involves both a physical change to the insured land as well as a loss of utility (or value) of the insured land and, in case where the pre-earthquake house on the property remains in place and is not to be rebuilt, also the associated residential building.

Engineering assessments

When EQC's engineers assess whether a property qualifies for IFV land damage, they address two key questions:

  • Is the insured land vulnerable to flooding?

  • Has the insured land become more vulnerable to flooding as a result of subsidence of that land caused by the 2010-2011 Canterbury earthquakes?

A property will not satisfy the engineering assessment for IFV where subsidence to the insured land has caused it to become more vulnerable to flooding. If a property was already prone to flooding prior to the earthquake, and the flooding vulnerability has not changed, then it will not qualify.

For the purposes of assessing IFV, EQC's engineers use a 1 in 100 year flood event (also known as a one percent Annual Exceedance Probability (AEP)) as a base line. An AEP of one percent means that there is a one percent chance of an event of that size being exceeded in any one year. This is a commonly used frequency for assessing vulnerability of land in natural hazards.

As part of their assessments, EQC's engineers had to create flood models to understand the impact of land subsidence on vulnerability to flooding. To make these flood models, they have:

  • gathered topographical information using LiDAR surveys. This involved the scanning of the ground surface from an aircraft after each major earthquake to assess changes in ground height;

  • modelled the river flooding for the Styx, Avon and Heathcote rivers, using Christchurch City Council models as a base;

  • modelled the overland flow (the effects of storm-water runoff) for the catchment areas of the Styx, Avon and Heathcote rivers, Sumner and Kaiapoi; and

  • modelled coastal inundation for areas surrounding the Heathcote estuary.

To determine whether the property has potential IFV damage, EQC's engineers apply the following initial thresholds:

  • The flood depth has increased by 0.2m or more as a result of the Canterbury earthquake sequence;

  • The flood depth has increased by 0.1m or more as a result of a single earthquake event; and

  • The land has suffered observed damage as a result of the Canterbury earthquake sequence.

Some exceptions to these thresholds apply.

Following this initial assessment involving initial thresholds, EQC’s engineers undertake site-specific assessments of potentially qualifying properties and then an area-wide review. The area-wide review is done to see whether any properties have been inappropriately assessed, including those not identified by initial thresholds.

If the property is still considered as potentially having IFV following the engineering assessment, a valuation assessment of the property will also be undertaken.

Valuation assessments

EQC's valuers undertake a valuation assessment of the property only if the property is considered as having increased vulnerability to flooding following the engineering assessment. This valuation is the final step in determining whether the property qualifies for IFV land damage.

The valuation threshold is whether the increase in flooding vulnerability impacted the market value of the property or in the case where the house has been or will be rebuilt, the insured land. If this threshold is met the property is confirmed as having IFV land damage.

More details of the engineering and valuation assessment processes can be found in the Increased Flooding Vulnerability (IFV) factsheet and the IFV and/or ILV Land Damage Consolidated Policy Statement, September 2016.

How are claims for IFV land damage settled?

If it could EQC would prefer to settle IFV land damage by providing a cash payment based on the amount it would cost to repair or reinstate the land. However, for IFV properties in many cases it will not be possible to identify a repair method to the land which is feasible or able to be done legally. For example, it may not be possible to get a resource consent to carry out the repair. In these cases, EQC is basing the settlement of IFV land damage on the reduction of value of the property. This reduction of value is called Diminution of Value (DOV).

Where a property with IFV land damage has been sold since the earthquakes, the settlement will also be based on DOV. This settlement approach for IFV land damage is consistent with the Declaratory Judgment which was delivered in December 2014.

EQC’s valuers have developed a standardised approach to assessing the impact on value of increases in flooding vulnerability. This approach is designed to ensure that DOV is calculated in a consistent way for all IFV customers.

The way in which the DOV is assessed will depend on whether the house on the property before the 2010-2011 earthquakes:

Where the house that was on the property before the 2010-2011 earthquakes remains in place and is not to be rebuilt:

Where the house that was on the property before the 2010-2011 earthquakes has been or will be rebuilt:

In each case, the methodology for determining DOV, including the updates and guidance notes, has been approved by a peer review panel of valuers nominated by the major New Zealand professional valuation associations.

More information on DOV can also be found in the Diminution of Value (DOV) due to Increased Flooding Vulnerability (IFV) land damage (for where house is still in place) fact sheet and Diminution of Value (DOV) due to Increased Flooding Vulnerability (IFV) land damage (for where the house has been or will be rebuilt) fact sheet.

Understanding your settlement pack

Set out below are sample IFV settlement packs which will be sent out for: 

  • properties where the house on the property before the 2010-2011 earthquakes remains in place and is not to be rebuilt; and 

  • properties where the house on the property before the 2010-2011 earthquakes has been or will be rebuilt. 

For properties where the house that was on the property before the 2010-2011 earthquakes remains in place and is not to be rebuilt:

1. Sample settlement pack for a customer with a property which qualifies for IFV land damage and their settlement is based on Diminution of Value. Sample pack consists of:

2. Sample settlement pack for a customer with a property which does not qualify for IFV land damage based on an engineering assessment. Sample pack consists of:

3. Sample settlement pack for a customer with a property which does not qualify for IFV land damage based on the valuation assessment of the property. Sample pack consists of:

For properties where the house that was on the property before the 2010-2011 earthquakes has been or will be rebuilt:

1. Sample settlement pack for a customer with a property which qualifies for IFV land damage and their settlement is based on DOV. Sample pack consists of:

If you have received your settlement pack for IFV land damage, you can ask for further details of your property’s engineering assessment and/or valuation assessment by:

  • calling us on 0800 326 243 between the hours of 7am to 9pm Monday to Friday, and 8am to 6pm on Saturday; or

  • emailing us at info@eqc.govt.nz.

How to request a review of your land settlement

Customers who receive their IFV land settlement pack can ask EQC to review its decisions on whether:

  • the insured land qualifies for IFV damage and/or

  • the settlement amount paid for IFV damage.

The request for review can be made at any point, including after an IFV payment has been made.

EQC will carry out a review when the customer provides EQC with new information or a different interpretation regarding these decisions. To trigger a review, a customer may, for example, provide information about:

  • the change in flood depths their property has experienced since the earthquakes;

  • whether the house has been or will be rebuilt on the property; or

  • whether they are going to obtain a consent to repair the IFV land damage.

When EQC reviews its decisions about IFV land damage in light of any new information or interpretation, it will include people with relevant expertise to help consider the issue. The experts included could be, for example, a senior engineer, senior valuer and/or senior settlement analyst. Review of a decision will not be undertaken by the same people who were involved in the original qualification.

To ask for a review, please email us at info@eqc.govt.nz or call on 0800 326 243 between the hours of 7am to 9pm, Monday to Friday, and 8am to 6pm on Saturday.

You can also send us your request with supporting information to:

Land Challenges

PO Box 311

Wellington 6140.

Need help?

Information on ways to access help from EQC and other support organisations is available on the Need help? page.

Questions and answers (Q&As)

Visit the Increased Flooding Vulnerability Q&As page for more information.

Topics covered include:

Qualification for Increased Flooding Vulnerability (IFV)

Declaratory Judgment

Settlement of claims for Increased Flooding Vulnerability land damage

Increased Flooding Vulnerability (IFV) Policy

Review process

Increased Flooding Vulnerability (IFV) land damage on properties where the house has been or will be rebuilt

Increased Flooding Vulnerability (IFV) of Unit Title Developments

 

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Page last updated: 31 Jan 2017

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