THE BIG ONE - Civic Assurance
THE BIG ONE
The earthquake that struck the Canterbury region on 4 September 2010
resulted in the largest claim ever made on Civic Assurance or its predecessors
The Christchurch Earthquake
Centred 40 kilometres west of the city of Christchurch near the town of Darfield and at a
depth of 10 kilometres, the magnitude 7.1 earthquake at 4:35 am on 4 September 2010
resulted in extensive damage throughout the Canterbury Region and as far away as Timaru.
The earthquake by a substantial margin caused more property damage than any other event
in the country’s history. The death toll predicted for an earthquake of this size according to
GNS Science was 75. Fortunately there were no deaths and that is thanks to good
adherence to the building codes, the early hour of the earthquake, and undoubtedly a
measure of good luck.
Christchurch earthquake damage
The damage was the result of three earthquakes just seconds apart that caused a 25
kilometre fracture across the Canterbury Plains and unleashed energy equivalent to 670,000
tonnes of explosive. The shaking lasted 40 seconds and moved parts of the land 4.5 metres
horizontally and up to 1.5 metres vertically.
Christchurch earthquake damage
Geologists have subsequently discovered a new fault trace, known as the Greendale Fault,
22 kilometres long, running from Greendale towards Rolleston. It is believed that it has been
at least 16,000 years since this ‘blind thrust fault’, which had been accumulating stress for
thousands of years, last ruptured. Scientists are also investigating what has been called a
foreshock of magnitude 5.8 just five seconds before the main shake. This foreshock
reportedly woke a number of sleeping Cantabrians, giving them some notice of the ‘big one’.
There were three distinct pulses of energy around the time of the main earthquake. The
foreshock was followed by two shakes which became entangled, making it difficult initially to
pinpoint the size (initially stated as magnitude 7.4), location, and depth of the main shock.
One of the more visible effects of the earthquake was soil liquefaction which caused many
small ‘sand volcanoes’, which are mounds of sand ejected to the surface, resulting in much
damage to homes, roads and pipe infrastructure. The liquefaction shook sandy soil violently
causing water to rise through its pores. Scientists compared it to jumping on wet sand at the
beach - it soon turns to a murky soup. Liquefaction requires shaking on the Modified
Mercalli Intensity scale of 7.0 or more.
Scientists from the University of Auckland Geology Department said the Canterbury
earthquake was one of the most significant cases of liquefaction in New Zealand history.
They said the process could affect any town or city near a river, estuary or coastline. Large
sections of Christchurch and Kaiapoi were built on soft sediments that remained saturated
after a wet winter. The good news since the earthquake is that there has been little rain,
which has allowed time to repair the damaged stopbanks.
As many as 9 out of 10 homes in the flat part of the city have been damaged by the
quicksand-like effect. Much of this damage was superficial rather than structural, but in
Bexley, a five-year-old subdivision near New Brighton, at least 100 new homes were left
uninhabitable after silt, sewage and grey sludge cracked the road and squeezed through
The worst-affected areas were coastal spots such as New Brighton and the suburbs that skirt
the lower reaches of the Avon and Heathcote Rivers. Some homes in Kaiapoi near the
Waimakariri River have partially sunk because of the liquefaction and lateral spreading.
The total damage from the earthquake is estimated to be between $4 billion and $5 billion.
Civic and LAPP’s Response
At the time of the earthquake, Civic Assurance insured the above ground assets for
Christchurch City Council, Environment Canterbury, Waimakariri District Council and Timaru
District Council. In addition, Christchurch City Council and Waimakariri District Council were
members of the Local Authority Protection Programme (LAPP Fund), a mutual fund managed
by Civic Assurance. LAPP was, designed to cover assets considered difficult and/or expensive
to insure such as below ground infrastructure, river control systems and flood protection
Damage sustained to Timaru District Council and Environment Canterbury’s assets was
minor. There was significant damage to Environment Canterbury’s network of stopbanks
and river control assets, but these were uninsured. Civic and LAPP’s focus was therefore on
the very significant damage to the assets of Christchurch City Council and Waimakariri
The earthquake caused significant damage to older buildings in the Christchurch central
business district and to buildings, land and infrastructural assets elsewhere in the city and in
the Waimakariri District. Damage was sustained to council buildings, community centres,
sporting facilities, heritage buildings, wharf structures, residential housing, building contents
and a considerable amount of reticulation infrastructure.
Damage was worse in areas of high liquefaction and lateral spreading. The most damaged of
all council owned assets was underground wastewater systems. Significant damage also
occurred to above ground pump stations. The formation of ‘sand volcanoes’ and large areas
of mud and sand caused disposal problems for property owners and council staff.
Civic appointed the international adjusting firm Cunningham Lindsey on the day the
earthquake happened to handle the assessment of all Civic and LAPP Fund losses.
Cunningham Lindsey established a response centre in the conference area of a central
Christchurch hotel and brought in assessing personnel from around New Zealand and
overseas. In the week following Civic also appointed engineers from Manawatu District
Council, Palmerston North City Council and Horowhenua District Council to assist with the
assessment of damage to underground reticulation systems.
To oversee the process and to assist the Councils with supplying the information needed to
properly assess damage, Civic very quickly employed a recently retired former General
Manager of Civic to be based in Christchurch. His role was to ensure the requirements of
Civic and LAPP’s reinsurers would be met, as without their support there would not be
enough money to pay the councils’ claims. Structural engineers and specialists in the
restoration of heritage buildings were also engaged.
Project Control Groups were established at both local authorities comprising council
engineers, departmental heads, finance personnel, assessors and insurer representatives.
These Groups meet weekly to review progress and work through assessment issues.
Waimakariri District Council Claim
The Waimakariri District is located 20 minutes drive from Christchurch, north of the
Waimakariri River. The district occupies about 225,000 hectares from the beaches of
Pegasus Bay in the east to the Puketeraki Ranges in the west and includes the towns of
Kaiapoi and Rangiora. The estimated district population is currently around 45,000.
Most of the damage in the district was sustained in Kaiapoi and the neighbouring seaside
settlements of Pines Beach and Kairaki Beach. Only one major council building was damaged
in the main town of Rangiora. In Kaiapoi, the Aquatic Centre, Memorial Hall, Kaiapoi Wharf
and buildings, Hansen’s Mall and Bridge Tavern, the library and offices, and the Court House
were the worst hit. Although ductile pipes largely withstood movement, brittle asbestos
cement and concrete pipes were seriously affected and the deep gravity fed sewer
reticulation system was severely damaged in many places.
At Pines Beach and Kairaki Beach, areas of high liquefaction, there was serious disruption to
water and wastewater services. In some parts of the settlements, temporary services were
still in place three months after the earthquake. At Kairaki Beach, the sewer pump station
lifted out of the ground and there was extensive use of portable toilets in all areas.
Loss of revenue and loss of rents claims will also eventuate and the total claim on LAPP and
Civic from Waimakariri District Council is expected to be of the order of $25 million.
The aftermath, Kairaki Beach
Damage to wastewater services, Kaiapoi;
Ground cracking, Kaiapoi wharf
Sunken amenities block, Pines Beach
Christchurch City Council Claim
Christchurch City Council is New Zealand’s second largest city and the second largest local
authority, providing services and facilities to its 368,900 residents.
The earthquake caused widespread damage. The mix of damaged assets was similar to
Waimakariri District, but the scale of damage was much greater. In addition, there was
significant damage to heritage buildings, residential units, the Bromley Sewage Treatment
Plant, pump stations and wells.
Footbridge over Avon River
The city’s infrastructure coped well because of good engineering standards and much of the
underground services came through intact. Lessons drawn from the 1994 Northridge
California earthquake and the 1995 Kobe earthquake had helped. For example, bridges
carrying electricity cables had received additional strengthening.
Underground wastewater infrastructure experienced most damage. Infiltration of sand and
silt into damaged reticulation pipes caused by the liquefaction created difficulties in
detecting damage and restoring services. Some 2700 homes were without sewer
connections and operated with temporary systems or portable toilets. As in Waimakariri
District, ductile pipes largely withstood movement but brittle asbestos cement and concrete
pipes suffered serious damage where there was lateral spreading and/or liquefaction.
The worst damage was in the oxbow loops around rivers where the roads and underground
services are surrounded by water on three sides. Lateral spreading caused jellified ground to
slump towards the lower lying waterways. The suburban riverside areas of Avonside,
Dallington, Burwood and Avondale and the river delta areas near Brooklands, Bexley and
Spencerville were the most affected.
Liquefaction not only broke pipework, but shifted levels up and down. This is a serious
problem for gravity-fed wastewater systems, which rely on even grading. In places the
sewerage system has moved noticeably towards the surface because sealed air-filled
structures will float upwards when the ground around them turns to watery jelly. Not
surprisingly, in areas where serious damage to wastewater reticulation has occurred, there
are likely to be issues with the water and storm water systems as well. However, water
pipes under pressure contain little air, so are denser than sealed wastewater pipes and less
likely to move if the surrounding ground liquefies. Concrete stormwater pipes normally do
contain a lot of air, but their larger size and weight makes them more resilient to movement.
The Bromley Waste Water Treatment Plant has relatively minor damage to buildings and
plant but significant damage to oxidation pond bunds (the dikes between the oxidation
ponds), which have experienced severe cracking and lateral slumping. Restoration will
necessitate re-engineering of the bunds and stabilisation of the ground under them. The
restoration of the land is not an issue for insurers.
Damaged bunds, Bromley Wastewater Plant
Pipe replacement, Bromley Wastewater Plant
Over 80 Christchurch City Council pump stations have been severely damaged. Some of the
pump station buildings such as Palmers Road were so badly affected that it was more than
two months before entry to the buildings was deemed safe enough to enable assessment of
the internal plant. Several smaller stations have been forced completely out of the ground
and all the connecting pipes shattered. The damage to pump stations initially necessitated
the pumping of waste using portable pumps directly into rivers and other waterways.
Temporary lines in affected areas were established so this practice has now ceased.
Pump station, Avonside
Palmers Road Pump Station
Some fresh water wells have been damaged and over 170 will be checked for breaks and
cracking using closed circuit television analysis (CCTV). Remediation is difficult and serious
damage has necessitated capping of some of the wells and re-drilling on alternative sites.
Damaged wells, Palmers Road
The worst affected of the Council owned heritage buildings was Godley House at Diamond
Harbour on Banks Peninsula, a Grade 2 New Zealand Historic Places Trust listed building built
in 1880 as a home for Harvey Hawkins, one of Lyttelton’s leading citizens. At the time of
writing it is not known whether this historic home can be saved.
Interior Godley House, Diamond Harbour
Godley House, Diamond Harbour
Two other damaged heritage structures are the iconic gothic revival Canterbury Provincial
Council Buildings, built between 1858 and 1865, which is the only purpose built provincial
government building still in existence in New Zealand, and ‘Our City’, a Queen Ann style
building dating from 1887, built as Christchurch City Council’s original council chambers and
now an arts and recreation centre.
Heritage ‘Our City’ building, Christchurch
Canterbury Provincial Chambers
As the second largest provider of residential housing in New Zealand, Christchurch City
Council owns around 2,600 housing units. Many of these were significantly damaged and
more than 60 will need to be completely demolished. This necessitated the re-housing of
hundreds of tenants and many agencies assisted both in support and in locating temporary
accommodation for displaced residents.
Ground cracking, Residential units, Bowie Place, Avonside
Claims for damage to sporting facilities and building contents are also being assessed and, as
in Waimakariri, a significant Business Interruption claim will result. The total claim for
Christchurch City Council on LAPP and Civic will be of the order of $150 million.
The most immediate problem after the earthquake was the clearing of silt blockages which
resulted from ground liquefaction: where pipe joints had broken, the weight of the ground
above can force mud through the gaps. To clear the system, water blasting was required.
The only practical means of detecting damage was with the use of closed circuit television
(CCTV) cameras. Teams of contractors have been putting cameras down sewers in affected
areas to get a complete picture of the damage underground. For Christchurch City Council,
it is thought that around 10% of its wastewater pipes from a total of 1790 kilometres has
been damaged. In a normal year, Council would budget for about 4 kilometres, which gives
scale to the size of the exercise.
LAPP has appointed a specialist engineer to work with Council staff in analysing CCTV
footage on a street by street basis, plotting and mapping each break using GIS technology.
Decisions are then being made, depending on the number of breaks in each length of pipe,
on whether to repair or replace. Lateral pipes from the main network which service
individual households are also being looked at (in part because broken sewage pipes can
admit high levels of unwanted storm water). This process can create problems from a cost
allocation point of view as part of each lateral asset is owned by Council and part is the
responsibility of the homeowner.
Broken sewer main
Damage to above ground assets where the damage is visible has generally proved much
easier to assess and quantify than LAPP Fund losses for below ground reticulation. That said,
some aspects of damage to above ground assets have needed specialist advice and input.
Currently there are over 650 assets on the Building Damage Schedule just for Christchurch
City Council and damage is still being reported. It goes without saying that claims for
residential housing and heritage buildings should be treated sympathetically.
In New Zealand, the Earthquake Commission (EQC) provides the first $100,000 of coverage
for insured residential buildings and the first $20,000 for contents. The balance up to
replacement value is contributed by commercial insurers. Claims to the EQC exceed 150,000
in number and have, of necessity, been prioritised. EQC adjusters must assess damage at
each site before commercial insurers can become involved. The assessment process will be
long and some householders may have lengthy waits before remedial work can commence.
As suppliers of residential housing, both Waimakariri and Christchurch have a social
obligation to arrange alternative accommodation for displaced tenants.
Approximately 10% of Christchurch City Council’s housing stock was severely damaged to
the extent that hundreds of tenants, many elderly or with special needs, had to be relocated while repairs were undertaken or alternative arrangements made. Recognising this,
EQC have assigned dedicated assessors to work with council staff to speed up the process.
As affected homeowners have been learning, sewer systems in both areas rely on gravity.
With much of the land being so flat, most of Kaiapoi and Christchurch City are served by a
series of invisible underground ramps to create the necessary falls. There are minimum
gradients required for this to work. The pipes in the upper part of the catchment are laid at
a shallow depth of around 1.5 metres deep, but as they move down the catchment the pipes
can end up being in trenches as deep as 6 metres.
Sheet piling and dewatering, deep sewer line replacement
The biggest claim cost to Civic/LAPP, and the most problematic from the point of view of
detecting and assessing damage in both the Waimakariri District and Christchurch City
catchments will be the restoration of the underground network of pipes which provide the
three essential services of water, sewage and stormwater. By far the most expensive and
problematic of these will be the repair of wastewater (sewage) reticulation systems.
Inevitably, restoration of Councils’ services cannot be done overnight and will involve a lot of
noise, dust and dug-up roads. It is also difficult work as laying pipe in deep trenches is a
skilled process because the falls have to be precise. In order to access the damaged area,
sheet iron piling is first needed to reinforce the excavation and hold back waterlogged soil
and the groundwater has to be pumped out at the right rate so as not to cause subsidence.
In areas that have experienced high liquefaction, the replacement of the deep gravity sewer
networks may not be the most practical or economic solution and work is currently being
undertaken to investigate alternatives such as pressure or suction systems, which operate at
a more shallow depth and are easier to repair or replace.
Heritage buildings have proved a special challenge for assessment teams. Public interest in
many of Canterbury’s and New Zealand’s iconic buildings and the requirements of local bylaws and the New Zealand Historic Places Trust to reinstate ‘sympathetically’ have meant
that specialist advice and knowledge needed to be involved. Civic has appointed one of the
country’s leading experts in the restoration of historic buildings who is working with heritage
architects to agree the scope of works and the restoration process for each of the 60
buildings that have currently been assigned to him.
In Christchurch, contractors have now been appointed to take day to day charge of the
infrastructural rebuilding work in different parts of the city. Each area is to be known as a
Pod with the head contractor in each being responsible for the restoration of all services and
for communicating progress to local residents. It is hoped all will be operational by the end
of 2010. Inevitably with damage of this magnitude, work in each Pod will be prioritised.
Some permanent infrastructural reinstatement work, particularly in the Christchurch areas
of Avonside and Burwood, will be delayed in order to stabilize and remediate liquefied
ground and make it fit for rebuilding. The Earthquake Commission is planning to build a
permanent retaining wall by sinking a line of piles along the Avon River bank, probably in the
form of stone-filled columns. This is designed to stop land slumping towards the river. Until
that work has been completed, permanent repairs in those areas will not be undertaken and
residents will continue to live with temporary solutions.
Because of the lesser scale of damage in the Waimakariri District, repairs are likely to be
effected more quickly that in Christchurch City. For both Councils however it is considered
that the assessment and restoration process of all the damaged infrastructure, buildings and
services will extend beyond two years.
This has been an incredibly difficult time for the two councils most affected: Waimakariri
District and Christchurch City. They and their staff are to be congratulated on the amazing
job they have been doing for their communities.
The claim from Christchurch City Council from this earthquake to Civic/LAPP is thought to be
bigger than any single insurance claim ever paid by a New Zealand insurance company to any
single policyholder. It has reinforced the value of having adequate insurance and proved in
the most convincing way possible the value of Civic Assurance and the LAPP Disaster Fund.