Significant event hotline: 1800 337 444
AFCA has dedicated support available for individuals and small businesses impacted by severe weather and floods, including those affected by cyclones.
Contents:
- What to do after a flood
- Understanding AFCA’s role
- Making an insurance claim
- Talking with your insurer
- Insurance claims – cooling off period
- What happens when I complain to AFCA?
- Delays in general insurance complaints
- Getting help for financial difficulty
- Support for small businesses
- Other help available, including support for First Nations communities
- Frequently Asked Questions
Watch: Natural disasters and financial complaints
What to do after a flooding event
If you have been affected by flooding or cyclones, contact your insurance company. If you are in financial hardship, contact your bank.
The Insurance Council of Australia (ICA) has shared advice for people who have been affected by flood and storm damage:
- Safety is the priority – don’t do anything that puts anyone at risk.
- Only return to your property when emergency services give the go ahead.
- If water has entered the property, don't turn on your electricity until it has been inspected by an electrician.
- Contact your insurance company as soon as possible to lodge a claim and seek guidance on the claims process.
- Start the clean up but first take many photos or videos of damage to the property and contents/possessions to support a claim.
- Remove any water damaged items such as soft furnishings and carpet that might pose a health risk from the property. Take a range of photos to support a claim and then dispose of the items. Don’t throw away items that could be repaired, unless they pose a health risk.
- Make a list of each item damaged and include a detailed description, such as brand, model, and serial number if possible.
- Speak to your insurer before you attempt or authorise any building work, including emergency repairs, and ask for the insurer’s permission in writing, as unauthorised work may not be covered by your policy.
- Do not drive your vehicle if it has suffered water damage.
Understanding AFCA’s role
Once you’re safe and the emergency has passed, the first step is to contact your insurance company, bank or financial firm.
If you find yourself in a dispute with your insurer or financial firm about your claim or request for assistance, AFCA can help to resolve it. We have special processes that identify and fast-track complaints from people in impacted communities who require urgent support, so we can assist you to resolve any complaints with your financial firm as quickly as possible.
AFCA’s role is to help you to reach an agreement with your financial firm about how to resolve a complaint you have about them. We are impartial and independent, and we can award compensation for loss you have suffered because of a financial firm’s actions. Our decisions are binding on a financial firm.
Making an insurance claim
If you need to make a claim on your home and contents, small business or other insurance policy, the first step is to check your product disclosure statement (PDS) to check that you are covered, and contact your insurer to make a claim. If you experience problems during the claim process that you can’t resolve directly with them, you can contact AFCA.
What to do after a natural disaster
What to do
- Make sure you’re safe.
- When it’s safe to return, take photos or make notes on the damage. You can find more information about the types of evidence to collect here.
- Lodge a claim directly with your insurer or insurance broker.
- If you are unhappy with their response, or you do not hear back, you can lodge a complaint with AFCA.
- If you are not happy with the outcome of your claim, delays with the claim, the proposed settlement or the service you have received, you can lodge a complaint with AFCA.
Talking with your insurer
We strongly encourage you to stay in contact with your insurer throughout the complaints process. AFCA also encourages insurers to talk to their customers regularly to avoid disputes.
Insurers may be experiencing delays due to the significant number of claims. It may be that your insurer will get back to you about your claim after you have made a complaint to AFCA. If this happens, we encourage you to work directly with your insurer to resolve your complaint. If your complaint resolves, please let us know by emailing info@afca.org.au.
Insurance claims – cooling off period
The General Insurance Code of Practice provides for a cooling off period for claims arising from a natural catastrophe or disaster. If your insurer has subscribed to the General Insurance Code of Practice (the Code) and it finalised your claim within one month of a natural catastrophe or disaster, you have a twelve-month period to check whether your claim included everything that was lost or damaged. This period is available to you even though you may have signed a release when your claim was finalised.
If you think the assessment of your loss was not complete or accurate, contact your insurer and ask for it to review your claim.
Some insurers also have guidelines which allow a review of your claim arising from a natural disaster at any time after finalisation.
Find out if your insurer is a subscriber of the Code
What happens when I complain to AFCA?
When you lodge a complaint with AFCA, we first refer your complaint back to the insurer, so they have an opportunity to resolve the issue with you directly. Generally, your insurer has up to 30 days to respond.
More than half of the complaints lodged with AFCA resolve at this early stage.
However, if your insurer does not respond after 30 days, is unable to resolve the issue, or you are not happy with their response, AFCA progresses your complaint to our case management stage.
Delays in general insurance complaints
We are currently experiencing delays in allocating general insurance complaints to our Dispute Resolution Specialists (case workers). This is due to a significant increase in complaints across most product areas at AFCA.
We apologise for the delays and acknowledge this is a difficult time for many people. We will work to resolve complaints as quickly as we can, and we thank you for your understanding and for showing respect to our staff as they work with you.
If your circumstances change, or you require urgent help from AFCA, please contact info@afca.org.au.
Complaints about flood claim decisions
When considering complaints about flood claim decisions, AFCA will evaluate all the available information to determine if the insurer’s claim decision is fair in all the circumstances.
If your complaint is about a flood claim decision, you should provide the following information as early as possible in the complaint process:
- photos and videos of property and damage
- CCTV footage if available (particularly in industrial, commercial, or shopping areas)
- information about timing of the inundation, direction of water flow, and clarity and colour of the water
- information from neighbours who may have a recollection of the timing and direction of the flood water(s).
Read AFCA’s factsheet about flood claim decision complaints here.
Getting help for financial difficulty
People affected by natural disasters can experience both short-term and long-term financial difficulties, ranging from lost credit cards and problems accessing cash through to being unable to make loan repayments.
Banks and other financial services providers generally provide assistance to customers in cases of genuine hardship. Banks have hardship teams that are experienced in supporting those impacted by natural disasters such as floods.
Depending on your individual circumstances, you may be able to receive assistance such as:
- Deferral of scheduled loan repayments for up to three months
- Waiving of fees and charges, including for early access to term deposits
- Debt consolidation to help make repayments more manageable
- Restructuring existing loans free of the usual establishment fees
- Offering additional finance to help cover cash flow shortages
- Deferring upcoming credit card payments
- Emergency credit limit increases.
If you encounter difficulties relating to a financial hardship application, you can make a complaint to us online, or call us on 1800 931 678.
More information on natural disasters and financial hardship can be found in this factsheet.
Please make sure you notify us that you have been affected by flooding when you make your complaint.
What to do
- Contact your bank or financial service provider
- Explain your situation and the assistance you’re asking for
- If your request is denied, you can contact AFCA for help
If you continue to experience financial difficulty after the initial crisis has passed and after the financial firm has already provided initial assistance, you can speak to your financial firm again, or contact AFCA.
Financial hardship after a natural disaster
Support for small businesses and primary producers
If you’ve lost your business or can’t work in your business due to disaster, or you’re a primary producer who has been impacted, you should contact your financial providers as soon as possible to let them know your situation.
Whether a financial firm can assist a small business or primary producer in financial difficulty will depend on the circumstances. However, AFCA expects that a financial firm will give any request for assistance genuine consideration.
What to do
- Contact your bank or financial service provider
- Explain your situation and the assistance you’re asking for
- If your request is denied, you can contact AFCA for help
More Information for small businesses about insurance complaints
Other help available
Financial counselling
The National Debt Helpline offers free, independent and confidential help for people in financial hardship. You can visit their website or call them on 1800 007 007.
Free legal advice
Legal Aid Queensland
- Natural Disaster Legal Helpline: 1300 527 700
- Email: cpuadvice@legalaid.qld.gov.au
- A guide to getting your insurance claim paid – When disaster strikes – cyclones, storms and floods
Legal Aid New South Wales
- Call: 1300 888 529
- Visit their website
Victoria Legal Aid
- Call: 1300 792 387
- Visit their website
Government response - Disaster Recovery Funding Arrangements
The Federal and Queensland Governments have activated support under jointly funded Disaster Recovery Funding Arrangements (DRFA). Residents in listed communities can apply for Personal Hardship Assistance grants of $180 for individuals (and up to $900 for a family of five or more) to cover the costs of essentials like food, clothing, and medicine.
The Personal Hardship Assistance scheme can be accessed here.
Support for First Nations communities
Mob Strong, Debt Help - Part of the Financial Rights Legal Centre, Mob Strong, Debt Help is a free legal advice service about money matters for Aboriginal and Torres Strait Islander peoples from anywhere in Australia.
ICAN - The Indigenous Consumer Assistance Network (ICAN) provides consumer education, advocacy and financial counselling services to Aboriginal and Torres Strait Islander peoples across the nation.
13YARN (13 92 76) is a national crisis support line for mob who are feeling overwhelmed or having difficulty coping. They offer a confidential one-on-one yarning opportunity with a Lifeline-trained Aboriginal or Torres Strait Islander crisis supporter, available 24 hours a day, 7 days a week.
Helpful information
Information from the Insurance Council of Australia – the representative body for the general insurance industry in Australia.
Small Business Debt Helpline – a not-for-profit that helps small business owners and sole traders in financial difficulty.
Beyond Blue on 1300 224 636 – support for anxiety, depression and suicide prevention.
Lifeline on 13 11 14 – 24-hour crisis support and suicide prevention services.
Frequently Asked Questions
Will my insurance cover my property for flood?
This depends on your policy.
Your product disclosure statement (PDS) and policy schedule will outline the level of cover provided under your policy. Coverage will differ depending on how you are affected.
Motor vehicle insurance:
Car policies often cover floods under the broad cover of ‘accidental loss or damage’ clauses given you have comprehensive insurance.
Home and contents:
Some home and contents policies offer coverage for flood damage as standard inclusion whilst others do not include coverage at all or offer it as an optional additional cover if you pay an additional benefit for the coverage.
AFCA expects insurers to be reasonable where there has been a total, or significant loss, and not generally ask for itemised contents with total loss claims.
Accident or sickness insurance, income protection or consumer credit insurance:
These policies cover you for accidents, injuries or if you lose your job under general sickness/illness or unemployment clauses.
Life insurance:
Life insurance policies offer coverage if you die, suffer a critical illness, or are permanently or temporarily unable to work due to an accident or illness. These policies can be standalone or held within your superannuation.
You can contact your insurer to check on your cover and start your insurance claim.
Even if you don’t have flood cover, you may still be covered if you can prove damage was caused by an event which is covered by your policy, such as storm or rainwater.
What is the definition of flood?
Since 2014, most home and contents insurance policies use a standard definition to define ‘flood’.
The covering of normally dry land by water that has escaped or been released from the normal confines of any of the following:
- A lake (whether or not it has been altered or modified);
- A river (whether or not it has been altered or modified);
- A creek (whether or not it has been altered or modified);
- Another natural watercourse (whether or not it has been altered or modified);
- A reservoir;
- A canal;
- A dam.
Unless your policy defines flood differently, the above definition is accepted.
It is important you understand the definition (if any) of storm, rain water or runoff used in your policy. There is no standard definition for these terms so the exact definition of each of these words will depend on the wording used in your policy.
Definitions commonly cover damage resulting from rain and sometimes rainwater run-off resulting from storms, but not from flood if the policy does not cover for flood damage.
What if I have arranged my policy through a broker?
You can contact your broker who will assist you with the claim’s notification, lodgement and handling. Your broker would assist you in understanding your policy’s provided cover.
What if my broker failed to arrange a flood cover for my property?
The duty of a broker includes the requirement to aid its client in determining policy coverage requirements and providing advice which is appropriate to its client’s needs. It also includes the requirement to explain the areas of exposure, uninsurable exposure and cover restrictions.
You will need to contact the broker in the first place and understand why the flood cover (if additional) was not in place at the time of the loss.
You can read more about AFCA’s approach to insurance broker disputes here.
Is it the insurer’s fault if I am underinsured?
In general, the answer is no if you organised the policy directly with the insurer. If you took the policy out through a broker, please refer to the above approach.
When you take out an insurance policy, the responsibility rests with you to read the policy documents and ensure the selected cover meets your needs.
If the cover is not suitable then you are entitled to negotiate the cover with the insurer or seek an alternative cover with another insurer. However, once an incident takes place, your loss will be assessed against the terms and conditions of the policy which was applicable at the time of the subject event.
What if I need emergency accommodation?
Ask your insurer if you are covered for the costs of emergency accommodation.
Your PDS will outline the level of additional benefits under the policy, including the policy limits and any other cost associated with your relocation.
In some instances, the temporary accommodation clause would extend to cover your family members and pets. Please refer to your PDS:
- specifically stating a percentage (e.g. 10%) of the value of the policy for which your insurer will cover you for in relation to temporary/emergency accommodation
- providing for a specific time period or a ‘reasonable time’ within which you will be able to claim in relation to such emergency accommodation
- providing that your insurer will pay for ‘reasonable costs’.
Given the extent of damage nature of impact on policyholders following a significant event such as floods, some insurers might have an accommodation assistance program in place. Contact your insurer for guidance and assistance.
AFCA encourages insurers to continue to be proactive and flexible when arranging and continuing temporary accommodation for customers under the terms of their policy. This includes providing cash payments instead of temporary accommodation where it is not available, and / or the policyholder is staying with friends or family.
What if I have a lot of debris on my property?
In general, insurance policy provides cover for a number of additional benefits under the policy such as:
- Emergency or alternative accommodation;
- Removal of debris and demolition;
- Professional fees such as architects, surveyor and legal fees; or
- The costs of complying with new regulations.
Additional benefits can be included in your insured amount or on top of the insured amount. Before agreeing to or organising any removal of debris, ensure you notify your insurer and it may direct you to a certain process which may assist you in establishing the extent of your loss later in the claim.
Following significant events, your state government might set up a clean-up program to assist homeowners with the removal of debris. Please refer to any updates from your local state government.
What if my property has been damaged by water or mould and requires disposal for health reasons?
You will need to notify your insurer of your situation and your insurer might direct and assist you in solving this issue.
In general:
- take photos or videos of any damaged items and buildings
- make a list of all the damage with as much detail as you can
- don’t dispose of any items unless you have to because it is a hazard – but before you do, make sure you document everything and try to get the insurer’s consent to dispose of those items
- take reasonable steps to minimise your loss. For example, moving your household items under shelter.
- try and document this with photos, invoices and evidence of any directives from council or local emergency services. If you do not do this, the insurer may reject any claims arising out of subsequent damage because of this
- keep samples of materials and fabrics to show your insurance assessor
- remove water or mud-damaged goods from your property that might pose a health risk, such as saturated carpets and soft furnishings
- make a list of each item damaged and include a detailed description, such as brand, model and serial number if possible
- store damaged or destroyed items somewhere safe
- speak to your insurer before you attempt or authorise any building work, including emergency repairs, and ask for the insurer’s permission in writing. Unauthorised work may not be covered by your policy
- do not throw away goods that could be salvaged or repaired.
What if the claim delays are impacting my family?
The General Insurance Code of Practice sets out timeframes for how long claim processes should take.
Depending on your individual circumstances, your insurer will let you know their decision within four months. However, in exceptional circumstances such as this one, your insurer will let you know its decision within 12 months.
Under the Code where the event causing you to make a claim has also caused urgent financial need for benefits, you can ask for your claim to be fast tracked.
AFCA looks at all circumstances when assessing the impact of the financial firm’s conduct.
What if I disagree with the insurer’s proposed scope of works?
Gather as much evidence as you can and provide copies to your insurer:
- witnesses/neighbours statements
- video/CCTV
- photos
- time of initial inundation
- direction of water flow
If your insurer is relying on expert evidence, consider obtaining your own independent expert report to support your case. The responsibility rests with you to establish the insurer’s repairs or proposed scope of works is inadequate or insufficient.
What if my property requires make safe repairs?
Your insurer has the right to inspect your property to establish the extent of its liability under the policy i.e. whether a property is repairable or a total loss. Check with your insurer before undertaking any repairs.
In some instances, the insurer can send a tradesperson to attend to the repairs or provide you with a consent to undertake the repairs yourself. The insurer may direct you on how to document the issue and the repairs for its further consideration.
After lodging the claim, your insurer will generally send out an assessor, builders and possibly hydrologists or engineers to inspect your property and assist in determining whether your claim is covered or not.
By undertaking make safe repairs, the insurer is not implying the loss is covered under the policy. AFCA expects both the insurers and the insured to act reasonably and adequately to minimise further loss or damage to the insured property.
Can I be cash settled to do my own repairs or get my own builder?
Yes, provided the policy allows for that.
Before you agree to cash settlement, you need to consider:
- whether it is at your insurer’s discretion or not
- whether your own repairer would undertake the required repairs for the settled amount. This may include any contingencies for any unforeseeable damage.
- you may have given up the life time guarantee if provided under your policy
- by cash settling the claim all the risks associated with the repairs are transferred from the insurer to yourself for any unforeseen damage, any additional damage requires once repairs commenced, fluctuation of the market rates
- policy holders do not have the same bargaining power as an insurer in securing lower rates for labour and materials.
If you have a property claim resulting from a catastrophe and the insurer cash settled the claim within one month after the catastrophe event, you can request a review of your claim if you think that assessment of your loss was not complete or accurate, even though you may have signed a release. Under the Code, the insurer must give you 12 months from the date of finalisation of your claim to ask for a review of your claim.
AFCA expects the insurer to act fairly and expects the cash settlement to reflect the costs the insured will incur to repair the damage.
What is a hydrology report and why has my insurer arranged this?
A hydrology report (prepared by an expert in the field) can determine how a home or property was flooded. Your insurer will arrange a hydrology report if they need to determine the primary cause of water inundation to make a claim decision.
While ultimate inundation is expected to be almost always flood, it is often the initial inundation that is in dispute, such as:
- heavy rainfall
- very high tides, or king tides
- storm surges
- dam releases
Hydrology reports can help to determine whether the likely source of the initial inundation was flood or not. This is because even if the initial inundation is at a low level, it can make a significant difference to the outcome for many complaints.
What information will AFCA consider if a hydrology report is not available?
Where a site-specific hydrology report is not available or obtaining one will cause unreasonable delay to the resolution of the claim or complaint, then AFCA will consider other relevant information. In doing so we will consider (and give appropriate weight to) regional or area hydrology reports, and other alternative information such as witness reports and CCTV footage.
Where there are likely to be delays in obtaining a site-specific hydrology report, your insurer should consider using available alternative information to support their decision, even if this information is limited.
If your insurer declines a flood claim, and you dispute the decision and request a site-specific hydrology report, then your insurer should communicate:
- whether they agree to obtaining one; and if they do
- the likely timing of the report and the delay this will create for the claim to be finalised.
Desktop reports
If it is not possible to arrange a site visit to undertake a site-specific hydrology report, your insurer should consider a desktop report undertaken by someone with the appropriate skill and expertise. In undertaking a desktop review, the hydrologist should consider the following matters:
- the specific details of the home (e.g. floor levels)
- all relevant data for the area (e.g. rainfall records, river levels, area observations)
- the local topography, catchment area and other relevant data.
Where available, your insurer should also consider yours, and other witnesses’ statements, about the flow of water and when inundation occurred first.
Site visits
AFCA will consider undertaking site visits to help collect information to decide the cause of the damage. However individual site visits for every complaint are not feasible due to the scale of flooded areas.
Where possible (and appropriate), AFCA will visit and inspect the affected areas and obtain local knowledge. This might involve visiting a sample of complainants’ homes and businesses, as well as some randomly affected properties / businesses. AFCA will inform the relevant insurer before the visit to any complainant’s property and, if possible, the insurer can also attend the site inspection.
Read AFCA’s factsheet about flood claim decision complaints here.
