The steel mesh in tens of thousands of New Zealand homes could compromise their house insurance, major UK insurers have told a class action lawyer.
New Zealand's largest insurer IAG, which owns State and AMI, said in a statement it was aware of this "emerging issue" and monitoring the situation.
The lawyer, Adina Thorn, today launched a class action suit targeting the makers of the mesh, including Steel & Tube in New Zealand, saying claims could amount to more than $100 million.
Substandard ductility or stretchiness of several companies' mesh, and flaws in the testing regime for it, were revealed by RNZ earlier this year.
All slab floors since 2012 have had this mesh in them.
The Commerce Commission is investigating, but Ms Thorn said that would not bring compensation for homeowners.
Her action is being paid for initially by London-based Harbour Litigation Funding, which has approached insurers about what compensation might involve.
"They have done some inquiries with some major insurers - I can't identify which insurers - and the initial view is that there could be an issue with home and contents insurance because a term of most home and contents insurance is that buildings have to be legally compliant," Ms Thorn said.
"These buildings are arguably not legally compliant because of the steel mesh.
"All I would flag ... is there's an issue around insurance. There needs to be compensation for that risk."
She said class action would target mesh makers and distributors but she would not rule out suing the government too over inaction by the Ministry of Business, Innovation and Employment, which is meant to regulate building.
