Brokers say farm properties and many homeowners in flood-hit NSW are uninsured for the damage, and businesses are threatening to abandon town centres such as Taree after the record rain and destruction. 

The Insurance Council of Australia has declared the floods a catastrophe and opened an insurance hub in Taree, and the number of claims received has topped 6000.  

Farm packs do not include flood, brokers say, leaving farmers uninsured apart from equipment such as tractors and quad bikes.

“They’ve really got nothing,” said Insure More’s Matthew Fawcett, a broker based in Taree.

Many businesses also lack flood cover due to the high cost, and Mr Fawcett says there is concern that Taree – worst hit by the catastrophe – may now start “to look like a bit of a ghost town”. 

“That’s the big issue,” he told insuranceNEWS.com.au. “We’ve got 100 flood-affected businesses in town. As we’ve been helping and cleaning up, most of Pulteney Street has said to us they don’t want to come back into that street.” 

Other commercial streets are “just about full”, he says, and rents in shopping centres would be significantly higher. “The risk is paying extra money in rent or getting flooded every four years.”  

He says Taree urgently needs a levee on Victoria Street, where there is a low point in the town.  

“If we can get that another metre and a half higher, it would substantially lower the risk to the CBD. It would save 40 or 50 businesses that would be in buildings that would be quite affected. Then insurers could redo their modelling and ... the price will be lower. We just need everyone to be aiming for the same thing and get it done. 

“We’re such an old town, everything was structured around the river ... the insurers just won’t touch it with a 10-foot pole and, unfortunately, most of the CBD from a flood perspective will continue to become unavailable.  

“More insurers are going to pull out because we’ve had businesses affected that have not ever been affected. So the insurers are going to just either pull right out or up their cost to the point that it’s just unobtainable for a small business.” 

In Maitland, Arma Insurance Brokers Hunter Valley MD Amanda Morris says motor claims are flowing in, but many properties lack flood cover. 

“They’ve actually got no insurance. There’s a lot of people who can’t afford the flood premiums in our areas, so there’s a lot of people who are uninsured,” she said. 

 “On the farm packs, there’s no offer. You can’t buy flood cover for ... the actual house and infrastructure, sheds and stuff.  

“There are no policies we’ve got access to as a broker to offer flood to farmers.” 

Maitland has a levee, and Ms Morris says many small businesses decided to run the risk of not paying high premiums for flood cover – and so far that has been a successful strategy.  

“Our levee hasn’t broken ... We’ve seen some pretty horrific flooding here, and the main street has not broken like Taree has,” she said. 

“Depending on where their office is located, it could be extra thousands of dollars, and they just can’t afford it. It’s a lesser of two evils with insurance these days – you’ve got to choose your pain: either putting yourself in a bit more financial hardship or running the gauntlet at storm time.” 

Water has inundated some homes, Ms Morris says.  

“We’ve got places that have never flooded [before] that have flooded now. A lot of people who are affected around the low-lying areas of Maitland wouldn’t have flood cover.  

“It’s just unaffordable. The premiums are in the order of $20,000-$30,000. A lot of the affected areas are traditionally elderly people – that prestige part of town where the elderly are – and they just can’t afford it. 

“People are just not insured. At my branch, despite the amount of water we’ve had and the flooding we’ve had, we’ve got minimal claims.”