16 March 2012

Flood report: ICA welcomes focus on improved flood protection and mitigation

March 16, 2012

following the floods. He said the industry had already made substantive changes that addressed key concerns listed in today’s report.

He said the insurance industry was pleased the Commission had identified the need for substantial improvements in the collation of flood mapping and data across the state, including the need for it to be available to the public.

“We believe this initiative is one that could be adopted nationally, with all data centralised with Geosciences Australia as has already been announced by Federal Financial Services Minister Bill Shorten,” Mr Whelan said.

“Insurers are also pleased that the Commission noted the extreme pressures the industry was under in January last year and that it had performed well under the circumstances.  

“The report also recognises the efforts the industry has made to refine its Code of Practice and provide more certainty to consumers in claims handling." Mr Whelan said the insurance industry had received 58,575 claims from the December 2010 to January 2011 floods, with insurance losses of $2.38 billion.

He said this figure included 26,812 residential property claims, with about 90 per cent of these now closed.  

“Since the disaster $1.69 billion in claims have been paid out in building and repair costs, replacement, cash settlements and accommodation, with $690 million in reserve payments continuing to be made,” Mr Whelan said.

Mr Whelan said the independent Financial Ombudsman Service (FOS) had handled about 1000 disputes relating to insurance claims from the Queensland floods, with about half of these being found in favour of consumers. Many related to the size of settlements, not the denial of claims.

“Following the floods the industry recognised the need to make changes. This has resulted in changes to the General Insurance Code of Practice, in-principle agreement on a standard definition of flood, and acceptance of a key facts sheet.  

“Five new products have entered the market this year that provide full flood cover," he said.

“We have also brought forward the triennial independent review of the Code by 12 months to this July, and we expect to appoint a reviewer in coming weeks.”


Handy web links:
2012 Revised Code of Practice:  
http://www.online-casino-8.pro/for-consumers/code-of-practice

2012 Response to Perrett Report ‘In the wake of disasters’, media release:  
http://www.online-casino-8.pro/assets/media/insurance-industry-has-already-acted-on-key-recommendations-of-perrett-report-says-ica-final.pdf

2011 Natural Disaster Insurance Review (NDIR) response:  
http://www.online-casino-8.pro/assets/files/natural%20disaster%20insurance%20review%20response.pdf

2011 ICA 10-point plan media release:
http://www.online-casino-8.pro/assets/media/ica-release---ten-point-plan-27th.pdf


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