Picture: NSW RFS/Flickr
NSW homeowners are reminded to check their insurance policies as the bushfire and flood season approaches amid soaring living costs.
The reminder came from Legal Aid NSW which says Australian Bureau of Statistics data reveals that home and car insurance costs rose by 16 per cent in the past year.
Legal Aid NSW’s Disaster Response Legal Service (DRLS) says many of its clients were under-insured or not covered for damage due to the rising cost of premiums or policy exclusions for flood and bushfire cover.
Senior disaster response lawyer Liz Lehmann says price remains a key factor when people choose insurance.
“That sometimes means they don’t choose add-ons such as flood coverage or they may be taking out a lower level of cover,” she says.
“The rising cost of rebuilding a home also means some people do not realise they are significantly underinsured.”
Lehmann says a review of your policy before disaster strikes means better preparation for the looming bushfire and storm season.
“We urge people to check their policies,” Lehmann says.
CASE STUDY
Mother-of-two Kathleen and husband Scott Mann were forced to flee, and their house suffered major damage, when floods and storms swept through Central West NSW in November 2022.
When she tried to make a claim, her insurer rejected it on the basis of a hydrology report that stated the property was flooded by creek water.
Her insurance policy did not cover flooding because Kathleen could not afford that extra cover.
Her DRLS lawyer lodged a dispute with the Australian Financial Complaints Authority (AFCA) and successfully argued that the damage was caused by stormwater runoff which her policy did cover.
The lawyer also showed there were inconsistencies in the hydrologist’s report.
For over 18 months, as the claim was challenged, the family were forced to live in a shed and camp on the property, with a makeshift bathroom and hose as a shower.
In late April this year, AFCA ruled in Kathleen’s favour which enabled her to claim eligible benefits and restoration works under her policy.
CONTACT DETAILS
NSW homeowners can contact the DRLS on 1800 801 529.
The Legal Aid NSW website provides a free insurance check-up tool as well.
The DRLS is a Legal Aid NSW service that provided more than 13,000 services since the 2019-20 bushfires statewide.
It helps with legal issues including insurance claims, tenancy problems, access to disaster grants and payments, financial hardship, family and domestic violence, and workplace rights.
