The Clutha District Council is taking steps towards self-insuring its assets as its membership to the Local Authority Protection Programme (Lapp) ends next month.
At the council's corporate services committee meeting last week, councillors were told Clutha's Lapp membership would end on June 30.
In July 2011, the council decided to leave the programme after its premium for the 2011-12 year increased to $149,058, up from $66,000 in 2010 - half of which was later rebated.
The increased premiums were to help Lapp replenish its funds which were exhausted by the Christchurch earthquakes.
The council also asked staff to look into self-insuring its assets, and $50,000 has been budgeted for self-insurance over the next financial year.
However, the council could still remain in Lapp if it wished, corporate services manager Alan Dickson said.
Lapp was created in 1993 by local authorities after a working party formed from local government interest groups considered the means by which they could meet their 40% share of disaster damage.
The Clutha District Council joined Lapp in October 1998 and has paid $678,397 in contributions since joining.
Twenty-two other local authorities had withdrawn from Lapp, but Lapp's chief executive did not agree with that figure, Mr Dickson said.
''We have to show we're acting prudently ... we don't need to be in it. I felt the $149,000 that they charged us after the earthquake was unfair.''
Councillor Jeff McKenzie said the council had made the right decision in 2011 when it signalled its intention to leave Lapp, and the risk involved with self-insuring was all in the early years.
Mr Dickson said the council faced a $1 million excess before the Government would step in to help with costs.
The council has an emergency fund of more than $3 million to cover its infrastructure including roading, water, wastewater, and stormwater.
When Clutha Mayor Bryan Cadogan asked how councillors felt about self-insuring, all raised hands in support.
Mr Dickson said the next step was to decide how, and how much, to rate for self-insurance annually, and if the fund should be capped.
Elsewhere in Otago, only the Waitaki District Council is also in Lapp, along with about 60 other local authorities in New Zealand.
Waitaki District Council strategy group manager Richard Mabon said that in 2011, Waitaki decided to remain with the fund, and its annual contributions increased from $70,000, with a 50% rebate, to $158,872. The figure for the 2012-13 year was $62,100, reflecting lower cover, more self-insurance and rebuilding the fund, he said.
Mr Mabon said the council reviewed its insurance programmes each year, and was to begin this year's review.
The Dunedin City Council, the Queenstown Lakes District Council, Central Otago District Council and 17 other local authorities are not members of Lapp.
