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Don't let a storm leave you at sea

CHOICE says don’t let tricky terms and conditions threaten your storm claim

7 June 2016

Consumer group CHOICE is reminding consumers to gather evidence and read the fine print of their insurance policies following the recent storms, with some consumers likely to face common exclusions such as "actions of the sea" or "storm surge".

"The last thing you want when you are cleaning up after a storm is to be left at sea by confusing terms and conditions in your insurance policy," says CHOICE Head of Media Tom Godfrey.

"It's important to collect detailed evidence about the damage such as eyewitness accounts, reports from independent experts and photos and videos of your property before and after the storm.

"Whether the claims process is smooth or a little rocky will depend on how your insurer defines the event that has affected your property and how clear the definitions are in your policy.

"Although nearly all home and contents policies cover the sudden excessive run-off of water as a direct result of a storm in your local area, which they define as 'storm' and 'storm run-off', not all will cover you for a 'storm surge' or 'actions of the sea'.

"The good news is consumers who are covered for 'flood' should benefit from the introduction of a common definition in 2014, although some policies will require you to opt-in. So, don't assume you're covered.

"Even with flood cover you might not be safe as houses if you live next to the ocean. It will come down to how your policy defines the event that has occurred. If your insurer decides you have been a victim of a 'storm surge' or an 'action of the sea' and not a 'flood', 'storm' or 'storm run-off', things can get a little choppy.

"Unlike 'flood', all events are defined slightly differently from policy to policy when it comes to storms," Mr Godfrey says.

"While it should be plain sailing for consumers with 'flood' cover and those protected for storm surge, most home insurance policies do not cover "actions of the sea" , which could include: 

  • rises in the level of the ocean or sea;
  • sea waves;
  • high tides or king tides;
  • any other actions or movements of the sea.
"If you've been affected by the storm, your best bet is to get your insurer on the phone as soon as possible and start the claims process," says Mr Godfrey.

"You should also to check your product disclosure statement to ensure:

  • You are insured for the specific event that occurred
  • What repairs are excluded under storm damage
  • If you are covered for temporary accommodation
  • If you are able to undertake emergency repairs."
For more on home and contents insurance visit: https://www.choice.com.au/money/insurance/home-and-contents/articles/insurance-code-of-practice-update

Insurance tips
  • Contents policies generally cover storm events although "storm surge" is not a given.
  • Always check the key fact sheet and product disclosure statement.
  • Don't assume you are covered for "actions of the sea".
  • Check you have "flood" cover as it can be an opt-in with some policies.
If you have been affected:
  • Collect eyewitness accounts about the time at which any water entered the house.
  • Gather evidence of the damage such as photos and videos of the property before and after the storm.
  • Policyholders have to make claims "as soon as possible".
  • Ask your insurer to share their findings with you.

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