New Zealand’s SkyCity secures US$50m fire payoutMarch 19 2020 by Yvonne Lau
New Zealand’s SkyCity Entertainment Group (SkyCity) will see a NZ$85 million (US$50.6 million) payout from the construction fire that severely damaged the International Convention Centre last October.
The group also announced a NZ$55 million (US$32.7 million) loss due to tourism decline from the Covid-19 outbreak.
SkyCity’s claims payout is expected over the course of April and will be utilised for construction repair works. From earlier reports, it is understood that major players Berkshire Hathaway, Chubb and QBE are the primary insurers insuring the construction convention centre. Chubb is thought to hold 80% of the cover.
At the of the fire, SkyCity chief executive Graeme Stephens commented that the company is “comfortable with the credibility of the insurer and their ability to meet their obligations.” SkyCity did not respond to a recent request for comment.
Stephens announced at a press conference this week that revenue is not meeting expectations. For the fiscal year, they will review corporate spend, particularly non-essential business expenditure in light of recent events.
In response to the virus outbreak, which Stephens noted as unprecedented for Australia and New Zealand (ANZ) businesses, SkyCity is “[anticipating further restrictions on mass gatherings [and border controls] in ANZ,” which will have an added business impact on the group.
The Insurance Council of New Zealand (ICNZ) have said that the Covid-19 situation is still developing, and that “many insurers are regularly updating their advisories with additional guidelines on what cover may or may not be available under their policies specifically in relation to [the] coronavirus.” ICNZ has not yet released financial loss or claims estimates for the New Zealand market due to the epidemic.
Graeme remains optimistic and added: “SkyCity is looking beyond the current challenges presented by Covid-19 and will seek to preserve existing jobs in New Zealand and Australia.”
The company employs 5,000 people and looks to increase their workforce in coming years.
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