Big payouts planned for quake-damaged homes

10:07 pm on 22 June 2011

The Government is set to offer residents on the worst-affected land in Christchurch the option of walking away from their homes with a substantial pay-out.

Radio New Zealand's political editor reports that under the deal, households on badly damaged land would be paid out based on the valuation of their houses before last September's earthquake, as long as they are insured.

The Government would pay the households, allowing them to rebuild or buy elsewhere in Christchurch, or move out of the city. It would take over the household's insurance cover and be repaid later by the insurance companies.

Under another option, households will be able to stay and continue dealing directly with their insurance companies.

They might choose this option if their replacement value cover is higher than the valuation of the property. However, that would leave them living in a suburb that no longer had basic services.

An initial announcement about the state of earthquake-damaged land in the city will be made on Thursday at 1.30pm.