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Slow progress: brokers helping flood-hit clients through claims delays

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The waters may have subsided but for communities where businesses and homes were swept up in the NSW/Queensland floods, the ordeal is far from over, according to brokers who spoke with insuranceNEWS.com.au.

They say an acute shortage of everything from loss assessors and tradies to building materials – the result of a global supply squeeze that is being felt throughout Australia and globally – is hampering the recovery process.

The scale of the catastrophe, the country’s most costly flood event, is also a huge challenge for insurers as the industry manages the massive volume of claims. Insurance Council of Australia data shows more than 196,700 claims have been lodged so far with insured losses in excess of $3.35 billion.

“It’s certainly not the insurers’ fault but trying to pacify a client who wants something to happen… they can understand but they don’t like it,” Tim Parry, a senior broker with Austbrokers NCFS in Lismore, said.

“It’s the delay in getting assessors on site and there are further delays in getting builders and tradesmen to carry out any work.”

He says clients who are covered for flood have had their claims accepted, noting “there haven’t been any issues with them not being accepted”. These clients are located in NSW townships such as Ballina, Byron Bay and Mullumbimby.

Mr Parry says for clients in Lismore, where commercial flood cover is typically not available due to the extreme risk of flood, they are in a “very difficult situation” and “the only ray of hope” for them is government recovery financial aid.

“I’m not feeling the mental strain,” Mr Parry said, when asked how is he coping with helping his clients. “It’s more the frustration with not being able to get things done, assisting things more rapidly for our clients.”

It’s a similar tale too for brokers in Queensland, who are doing all they can to support their clients despite the very challenging situation.

Brisbane-based CPR Insurance Services Director Mandy Cooper says “not all claims are running as well as we’d like”.

“It’s just a lack of repairers and people on the ground,” Mrs Cooper said. “I just don’t think people out there understand the sheer volume that we’re facing.

“If you can get a roofing expert on your property within three weeks of trying to find one, you have struck gold in Queensland.”

She says insurers handled the floods event differently, noting some have been “absolutely amazing” with the way they have provided support to affected clients in relation to their claims and subsequent follow-ups for repairs.

On her part, Mrs Cooper is all-hands-on-deck with her clients, checking regularly with them and also chasing their insurers to try to speed up repairs and insurance claims progress payments where possible.

A number of her clients who are covered for flood, taking up her advice despite having to pay a bit more for their business package insurance, have had their claims accepted.

“I haven’t had any issues with acceptance of flood or even storm claims,” Mrs Cooper said. “Yes, some of the insurers have gone through hydrologists but we knew it wasn’t a flood issue and we have talked our clients through that process to reassure them.”

One of her clients, a bike retailer, is receiving progress payments for business interruption after their premises were inundated.

“The progress payments are working well,” Mrs Cooper said. “And that’s why I say ‘let me know when the money’s running dry and we’ll see what we can do’. I'm checking in on them, and also making sure everything is getting through and I said ‘I’m your pressure point when money’s running dry’.”

Another client, a corporate gift hamper business owner, had her flood claim accepted, which will help recover the total loss she suffered when the water seeped into her premises and destroyed all the stock she had.

Mrs Cooper says the client, who also took her advice to have flood cover, is “very grateful” that the policy has worked for her on this occasion.

“It’s about being diligent,” Mrs Cooper said. “It’s not just about selling policies. This is where our true value as brokers comes to the fore.”

Looking beyond this latest flood catastrophe, Mrs Cooper says she understands insurers are already reassessing their underwriting criteria and one has had a “knee jerk” reaction by hiking premiums and another is probably not going to offer flood cover anymore in at-risk locations.

Shielded Insurance Brokers MD Stuart Brady says the NSW/Queensland flood catastrophe is “different” from previous natural disasters because of the sheer scale of the damage and ongoing external pressures that are being felt throughout Australia such as shortages of building materials and tradies.

“The claims are taking longer than usual to process because of the sheer volume of claims. It is difficult to find tradies,” Mr Brady tells insuranceNEWS.com.au. “Insurers are doing all they can but their hands are tied by factors beyond their control.”

He says his brokerage is doing “absolutely everything” it can to help affected clients with their claims despite the very challenging situation.

“With all things considered our clients’ claims are progressing well, albeit with delays due to insurers having huge workloads,” Mr Brady said. “Clients’ claims are having to fall into a queue process so there are definitely areas where clients may feel like a number.”

Where flood cover is concerned, Mr Brady says his brokerage makes it a point to go through a detailed fact-finding process and cover requirements discussion with clients before a policy is taken up.

“In most cases flood is covered in flood prone areas unless the client is adamant no flood cover is required for their particular situation,” he said.

Like many in the broking community, Mr Brady and his team have helped flood-affected communities by delivering critical necessities such as bottled water, cleaning equipment, medical supplies and food as well as making donations to emergency shelters.

In March his team drove from the Sunshine Coast to the Northern Rivers region to assist local residents.

“It’s uplifting to see how the community sprung into action to assist each other,” he said.

flood pic 2

Help at hand: Shielded Insurance Brokers delivered essential supplies