The Court of Appeal has upheld a High Court decision relating to when during the day an insurance contract started.  The exact time the contract started was important because the Christchurch earthquake occurred at 4.35 am on the day contract started and at that time another insurance contract was also in existence which expired at 4 pm on the same day.

The insurance contracts in issue did not specify a start time but did specify an expiry time of 4 pm on that day in 12 months.  4 pm on the day of the earthquake was the time the first insurance contract was due to expire and the Court held that the second contract was only intended to start at the time the first contract ended even though it did not specify a start time in the contract.  This meant that only the first policy responded to the earthquake damage and that insurer was not entitled to a contribution from the second insurer.

Alan Knowsley

Insurance Lawyer