The liquidation of Queenstown-based boutique insurer Western Pacific Insurance could be concluded by the end of next year, more than five years since its collapse.
Western offered 7000 policy-holders around the world insurance cover amounting to $10 billion, but following the Canterbury earthquakes in 2010-11, it was unable to pay just $6 million in claims.
Western was placed in liquidation in April 2011 by its owners, Queenstown businessman Graham Smolenski and his brother in law, Jeff McNally.
Grant Thornton NZ was appointed liquidator.
Of the total $75 million in claims, Canterbury quake victims are owed $58.5 million, but are likely to receive around $32 million while other unsecured creditors owed $16.5 million will be unlikely to be paid out.
In Grant Thornton's latest six-monthly report, liquidator David Ruscoe estimated the liquidation would be completed in 2016, dependent on loss assessment and reinsurance recovery being completed.
It ''appears unlikely'' there will be any dividend for ordinary unsecured creditors, he said of $16.53 million owed.
The bulk of that was $14.62 million of estimated insurance claims.
A court order in mid-2012 determined that money coming from Western's reinsurers would go towards the Canterbury earthquake claimants, affected by the September 2010 and February 2011 quakes.
Since March, all 204 of the claims notified had been allocated to loss adjusters for assessment, Mr Ruscoe said.
The total 204 claims are valued at $58.5 million: 92 from the 2010 quake valued at $15 million and 112 from 2012 valued at $43 million.
The estimated reinsurance recoveries, less $1.72 million in premiums due and still subject to further costs, is $32.18 million, which appears to leave a shortfall of $26.35 million.
Combined with unsecured creditors' losses, the final shortfall figure grows to more than $42 million.
In 2011, Grant Thornton noted Western Pacific had accepted risks ''outside the scope of its reinsurance policies'' and ''in some instances, premiums were too low''.
Western was able to operate with just a $500,000 bond lodged with Perpetual Trustees.
The potential liabilities of more than $10 billion included policies offered in Australia, Chile, Abu Dhabi and Pacific Island countries.
