An ‘insurance catastrophe’ has been declared in New South Wales after more than 5,000 home and property claims were lodged, with more to come

Brook Mitchell/Getty Images
  • Severe flooding in across New South Wales has led to an ‘insurance catastrophe’, the Insurance Council of Australia says.
  • The designation will see insurance agencies grant priority to flood-affected policy holders and institute a dedicated disaster hotline.
  • More than 5,000 claims have already been lodged, with more expected when evacuated residents return to their properties.
  • Visit Business Insider Australia’s homepage for more stories.

The New South Wales regions ravaged by extreme rainfall and flooding have been declared an insurance catastrophe zone, with Australian insurers receiving more than 5,000 individual claims in recent days.

The Insurance Council of Australia (ICA) announced its catastrophe declaration on Monday, after days of severe rainfall saw floodwater inundate swathes of NSW’s Mid-North coast and threaten pockets of Western Sydney.

The catastrophe declaration will see insurance providers prioritise claims from flood-affected policy holders, with disaster response specialists mobilised when emergency services deem it safe to do so.

In addition, the ICA has activated its emergency hotline at 1800 734 621 for policy holders who are unsure of their precise insurance details (the ICA notes this is not a claims line).

ICA CEO Andrew Hall said it is too early to assess the full damage caused by the flooding, but stated at least 5,000 claims have been lodged already.

“As many areas are currently inaccessible due to floodwater, insurers are expecting further claims in coming days as emergency services allow residents to return to their properties to examine the extent of their damage and losses,” Hall said.

ICA said it is monitoring weather-affected parts of South-East Queensland to determine if a further catastrophe warning is required.

On Sunday night, insurance industry giant IAG said it had received more than 2,100 claims linked to the severe weather and flooding.

“We now have additional resources in place to help our customers get back on their feet and we encourage customers to contact us to lodge their claim as soon as possible so we can organise immediate assistance,” said IAG CEO and managing director Nick Hawkins.

Government relief payments offered while NSW is ‘battered by the floods’

Some 15,000 people have been ordered to evacuate from affected North Coast regions and 3,000 from the Richmond area, NSW Premier Gladys Berejiklian said Monday.

“Some communities battered by the bushfires are now being battered by the floods, and deep drought prior to that,” she said.

“And I don’t know any time in a state history where we have had these extreme weather conditions in such quick succession in the middle of a pandemic.”

In addition to insurance claims, some financial assistance is available to hard-hit residents.

Up to 38 areas current regarded as natural disaster areas, meaning impacted residents can access disaster recovery payments of up to $1,000 per eligible adult, and $400 per eligible child, through Services Australia.

In addition to those lump sum payments, the Disaster Recovery Allowance is open to eligible claimants who can demonstrate they lost income as a result of the floods.

The maximum Disaster Recovery Allowance is equal to the JobSeeker Allowance, which is set to hit $620.80 from April 1.