Flood Inquiry Report provides clear roadmap to lift insurer standards
Consumer groups have welcomed the release of the Final Report of the Standing Committee on Economics’ Inquiry into Insurer’s responses to 2022 Major Floods.
The groups have called on the insurance sector and the Insurance Council of Australia to accept all the recommendations and implement changes to their internal processes and the Code of Practice as soon as possible. It is only in making this commitment to their customers can we avoid a repeat of not just the devastating impact the floods had on the Australian community but the stress and trauma people experienced when dealing with their insurer.
Quotes attributable to:
Philippa Heir, Managing Lawyer, Consumer Action Law Centre
“Floods and the threat of climate disaster are sadly the ‘new normal’ and the changes are absolutely vital to ensure that people, and society can recover and move on from such events.
“People pay for insurance to protect their homes and safeguard their future. We need these changes to ensure people really get what they pay for.
“This means acting on these 85 recommendations now – not mid-2025 or 2026 – now. Otherwise, insurers will be caught flat-footed again leading to more stress, trauma, and heartache.”
Alexandra Kelly, Director of Casework, Financial Rights Legal Centre
“The Insurance Law Service continue to hear from Australians impacted by floods who are still facing difficulties with their insurer – be it long delays, poor communications, low ball cash settlement offers, mistreatment of people with additional needs, increasing premiums, poor quality expert reports … the list is endless.
“This report places insurers on notice. Its 85 recommendations provide a clear roadmap to insurers to clean up their act in the wake of the floods and improve their claims handling standards.
“Many of the recommendations are focussed on the insurance sector’s improving its self-regulatory code of practice. General insurers need to implement these recommended changes – and the changes recommended in the recent report of the Independent Review of the Code – without delay. If they do not, the Government should be prepared to step in and legislate the changes required.”
Tom Abourizk, Head of Policy, CHOICE
“The home insurance industry is not working for consumers, particularly those bearing the risk of extreme weather events. The recommendations made in the Committee’s report rightfully call for big improvements to the services insurers provide, and the industry needs to heed all these calls.
“The industry also must act on recommendations addressing problems in their pricing practices. It is high time for insurers to stop charging consumers who cannot pay their annual premium more for paying by the month, and to commit to provide premium discounts when households take steps to make their properties safer or more resilient.”
Melissa Hardham, CEO, Westjustice
“Our frontline caseworkers have seen an overall deterioration in how our clients experience insurance – from time taken to handle claims, to fair and appropriate dealing with people experiencing language barriers or complex issues. We were privileged to share their experiences in our submissions to this inquiry and hope this leads to improved outcomes and experiences for future claims.
“The continued challenges of climate change and the complexity of the insurance system mandate the need for effective coordination at state and federal level for well-funded community legal and financial counselling services. We hope these sensible recommendations are acted on promptly.”
Background
The Final Report of the Standing Committee on Economics Inquiry into insurers’ responses to 2022 major floods claims can be found here: https://www.aph.gov.au/floodinsurances
ENDS
Media contact: Mark Pearce, Media and Communications Adviser, 0413 299 567, media@consumeraction.org.au
