Insurer RACQ is to be commended for deciding to pay 247 flood-related insurance claims they had previously denied, Assistant Treasurer Bill Shorten said today.
The 247 claims, mainly for residents in the Ipswich area, brings to a close over six long months of heartache and worry for the policy holders, who will now be able to get on with rebuilding their lives.
The decision not to pay was changed following the release of new data from Brisbane City Council about water flows following the floods.
Member for Blair, Shayne Neumann, said "I'm very pleased, on behalf of the policy holders affected, with this outcome. It is awful that is has taken so long and we are still working with other policy holders, but this is very good news."
More than 99% of people making claims for loss and damage arising from the Queensland floods have now received an answer from their insurers.
Of the 99 per cent, about 85 per cent of claims have been accepted, with about 15 per cent of claims refused.
Assistant Treasurer Bill Shorten said "While this is great news from RACQ, it is clear the rate of disputes for flood claims is unacceptably and substantially higher than for other natural disasters such as bushfires, cyclones and hailstorms."
"I therefore repeat my calls on the insurance industry to continue to work with the Gillard Government to deliver a standard definition of flood to ensure policy holders know where they stand and have confidence in the insurance product they are purchasing," he said.
Mr Neumann said "I strongly encourage all policy holders who are still waiting a response or who are disputing their insurer's decision to contact my office on (07) 3201 5300."
Policyholders whose claims have been denied should ask their insurer to review the claim, and, where appropriate, ask for a review of the decision by the Financial Ombudsman Service (Phone 1300 780 808).
Claimants may also seek assistance through Queensland Legal Aid's Flood and Cyclone Help service (Phone 1300 651 188). This service has been established with the financial assistance of the Australian Government and the Insurance Council of Australia.
The Australian Government has a broad range of initiatives in place to ensure insurance coverage adequately compensates for damage from natural disasters and is taken up by as many people as possible.
A proposal for a standard definition of 'flood' to ensure that people understand what they are, and are not, covered for, and other initiatives are outlined in the discussion paper Reforming Flood Insurance: Clearing the Waters (available through the Treasury website http://www.treasury.gov.au). Legislation for the new definition will be taken to Parliament before the end of the year.
Longer term issues are being addressed through the Government's Natural Disaster Insurance Review (NDIR). The Review has recently released a discussion paper available at http://www.ndir.gov.au/content/Content.aspx?doc=issuespaper.htm. Mr Neumann is currently in Western Australia with the House of Representatives Social Policy and Legal Affairs Committee inquiring into the operation of the insurance industry during disasters.