AFCA rejects premium hike, notification complaint
A homeowner who sought an $18,000 refund after accusing Allianz of failing to tell her about major increases to her optional flood cover costs has lost a dispute before the industry ombudsman.
The complainant said her monthly premium climbed to $1277 from $369 in August 2022, but she only became aware of this in March last year after seeing the direct debit payments on her bank statements.
Allianz said it sent documents to the woman’s property, in line with her listed method of communication. It showed it had sent renewal letters for 2022 and 2023 and there was no record of them being returned or undelivered.
The policyholder said she received all documents between 2016 and 2021 but found no written notice of the premium increase.
She acknowledged this could have been due to a mail mix-up at her multiunit address but argued a separate notice should have been sent by registered post or email.
Allianz said the premiums increased after a reassessment of the property’s flood risk, and it presented data showing the home was in an “extreme flood risk zone”.
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The complainant said her local council had determined the location had low flood risk.
But the Australian Financial Complaints Authority says the woman’s reference to a March 2020 email exchange between her builder and the council is not enough to determine the property’s flood risk.
It notes she was invited to provide her own flood risk assessment – a detailed report from the local council or flood management authority, or an independent hydrologist – but she did not.
The authority says the insurer met its obligations in sending documents to the property and it was reasonable to assume she was aware of the changes.
“It is the complainant’s responsibility to review policy documents and monitor direct debits,” AFCA said. “If dissatisfied with the premium or flood cover, she should have contacted the insurer at renewal or sought alternative cover; she did not do so until 19 months later.”
See the ruling here.
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