The Canterbury earthquake sequence (2010-2011) was the most devastating catastrophe in New Zealand‘s modern history. Fortunately, in 2011 New Zealand had a high insurance penetration ratio, with more than 95% of residences being insured for these earthquakes. This dissertation sheds light on the functions of disaster insurance schemes and their role in economic recovery post-earthquakes. The first chapter describes the demand and supply for earthquake insurance and provides insights about different public-private partnership earthquake insurance schemes around the world. In the second chapter, we concentrate on three public earthquake insurance schemes in California, Japan, and New Zealand. The chapter examines what would have been the outcome had the system of insurance in Christchurch been different in the aftermath of the Canterbury earthquake sequence (CES). We focus on the California Earthquake Authority insurance program, and the Japanese Earthquake Reinsurance scheme. Overall, the aggregate cost of the earthquake to the New Zealand public insurer (the Earthquake Commission) was USD 6.2 billion. If a similar-sized disaster event had occurred in Japan and California, homeowners would have received only around USD 1.6 billion and USD 0.7 billion from the Japanese and Californian schemes, respectively. We further describe the spatial and distributive aspects of these scenarios and discuss some of the policy questions that emerge from this comparison. The third chapter measures the longer-term effect of the CES on the local economy, using night-time light intensity measured from space, and focus on the role of insurance payments for damaged residential property during the local recovery process. Uniquely for this event, more than 95% of residential housing units were covered by insurance and almost all incurred some damage. However, insurance payments were staggered over 5 years, enabling us to identify their local impact. We find that night-time luminosity can capture the process of recovery; and that insurance payments contributed significantly to the process of local economic recovery after the earthquake. Yet, delayed payments were less affective in assisting recovery and cash settlement of claims were more effective than insurance-managed repairs. After the Christchurch earthquakes, the government declared about 8000 houses as Red Zoned, prohibiting further developments in these properties, and offering the owners to buy them out. The government provided two options for owners: the first was full payment for both land and dwelling at the 2007 property evaluation, the second was payment for land, and the rest to be paid by the owner‘s insurance. Most people chose the second option. Using data from LINZ combined with data from Stats NZ, the fourth chapter empirically investigates what led people to choose this second option, and how peer effect influenced the homeowners‘ choices. Due to climate change, public disclosure of coastal hazard information through maps and property reports have been used more frequently by local government. This is expected to raise awareness about disaster risks in local community and help potential property owners to make informed locational decision. However, media outlets and business sector argue that public hazard disclosure will cause a negative effect on property value. Despite this opposition, some district councils in New Zealand have attempted to implement improved disclosure. Kapiti Coast district in the Wellington region serves as a case study for this research. In the fifth chapter, we utilize the residential property sale data and coastal hazard maps from the local district council. This study employs a difference-in-difference hedonic property price approach to examine the effect of hazard disclosure on coastal property values. We also apply spatial hedonic regression methods, controlling for coastal amenities, as our robustness check. Our findings suggest that hazard designation has a statistically and economically insignificant impact on property values. Overall, the risk perception about coastal hazards should be more emphasized in communities.
The use of post-earthquake cordons as a tool to support emergency managers after an event has been documented around the world. However, there is limited research that attempts to understand the use, effectiveness, inherent complexities, impacts and subsequent consequences of cordoning once applied. This research aims to fill that gap by providing a detailed understanding of first, the cordons and associated processes, and their implications in a post-earthquake scenario. We use a qualitative method to understand cordons through case studies of two cities where it was used in different temporal and spatial scales: Christchurch (2011) and Wellington (Kaikōura earthquake 2016), New Zealand. Data was collected through 21 expert interviews obtained through purposive and snowball sampling of key informants who were directly or indirectly involved in a decision-making role and/or had influence in relation to the cordoning process. The participants were from varying backgrounds and roles i.e. emergency managers, council members, business representatives, insurance representatives, police and communication managers. The data was transcribed, coded in Nvivo and then grouped based on underlying themes and concepts and then analyzed inductively. It is found that cordons are used primarily as a tool to control access for the purpose of life safety and security. But cordons can also be adapted to support recovery. Broadly, it can be synthesized and viewed based on two key aspects, ‘decision-making’ and ‘operations and management’, which overlap and interact as part of a complex system. The underlying complexity arises in large part due to the multitude of sectors it transcends such as housing, socio-cultural requirements, economics, law, governance, insurance, evacuation, available resources etc. The complexity further increases as the duration of cordon is extended.
The lived reality of the 2010-2011 Canterbury earthquakes and its implications for the Waimakariri District, a small but rapidly growing district (third tier of government in New Zealand) north of Christchurch, can illustrate how community well-being, community resilience, and community capitals interrelate in practice generating paradoxical results out of what can otherwise be conceived as a textbook ‘best practice’ case of earthquake recovery. The Waimakariri District Council’s integrated community based recovery framework designed and implemented post-earthquakes in the District was built upon strong political, social, and moral capital elements such as: inter-institutional integration and communication, participation, local knowledge, and social justice. This approach enabled very positive community outputs such as artistic community interventions of the urban environment and communal food forests amongst others. Yet, interests responding to broader economic and political processes (continuous central government interventions, insurance and reinsurance processes, changing socio-cultural patterns) produced a significant loss of community capitals (E.g.: social fragmentation, participation exhaustion, economic leakage, etc.) which simultaneously, despite local Council and community efforts, hindered community well-being in the long term. The story of the Waimakariri District helps understand how resilience governance operates in practice where multi-scalar, non-linear, paradoxical, dynamic, and uncertain outcomes appear to be the norm that underpins the construction of equitable, transformative, and sustainable pathways towards the future.
Seismic isolation is an effective technology for significantly reducing damage to buildings and building contents. However, its application to light-frame wood buildings has so far been unable to overcome cost and technical barriers such as susceptibility to movement during high-wind loading. The precursor to research in the field of isolation of residential buildings was the 1994 Northridge Earthquake (6.7 MW) in the United States and the 1995 Kobe Earthquake (6.9 MW) in Japan. While only a small number of lives were lost in residential buildings in these events, the economic impact was significant with over half of earthquake recovery costs given to repair and reconstruction of residential building damage. A value case has been explored to highlight the benefits of seismically isolated residential buildings compared to a standard fixed-base dwellings for the Wellington region. Loss data generated by insurance claim information from the 2011 Christchurch Earthquake has been used by researchers to determine vulnerability functions for the current light-frame wood building stock. By further considering the loss attributed to drift and acceleration sensitive components, and a simplified single degree of freedom (SDOF) building model, a method for determining vulnerability functions for seismic isolated buildings was developed. Vulnerability functions were then applied directly in a loss assessment using the GNS developed software, RiskScape. Vulnerability was shown to dramatically reduce for isolated buildings compared to an equivalent fixed-base building and as a result, the monetary savings in a given earthquake scenario were significant. This work is expected to drive further interest for development of solutions for the seismic isolation of residential dwellings, of which one option is further considered and presented herein.
