Insurance woes blamed on name of the disaster

ABOVE: John Macdonald’s house in Broadwater was flooded to the first floor but he won’t get an insurance pay-out. Photo: Contributed

Susanna Freymark

John Macdonald’s house at Broadwater was damaged in the floods.

The 73-year-old lives at Ellangowan and his home wasn’t impacted by the floods but at his Broadwater property, floodwaters reached the first floor of the house causing $20,000 worth of damage.

“I put the house above the 1974 flood level,” Mr Macdonald said.

When Mr Macdonald phoned NRMA Insurance he was told he wasn’t eligible for a pay-out because of the classification of the flood event.

He said if it had been a cyclone that caused the floods, he would have got a pay-out. Because it was deemed a flood or storm, he gets nothing.

An Insurance Council of Australia spokesperson said the council declared the February/March floods an insurance catastrophe on behalf of the industry, determined by the impact on personal and commercial property. 

“As of late April 2022 – $3.34 billion in estimated losses with 196,761 claims were lodged of which 45.4% of claims are from NSW,” the spokesperson said.

Many residents can’t afford insurance at all. For Mr Macdonald and thousands of others who are insured, the classification of the flood disaster on February 28-March 1 matters.

Mr Macdonald said the second flood event in March, which didn’t flood his Broadwater home, was called an extratropical cyclone by Higgins Storm Chasing, an online weather group.

The Bureau of Meteorology said the classification of floods and storms was the responsibility of insurance companies.

“The Bureau has no direct role in this,” a BOM spokesperson said.

“The weather system affecting northern NSW was not a tropical cyclone.”

At the time, TV commentators were using the term ‘rain bomb’.

“The Bureau does not use the term ‘rain bomb’. The term has no technical or scientific basis,” the BOM said.

Despite what the disaster is called, State MP Janelle Saffin has asked NSW Treasurer Matt Kean to tackle the issue of a flood reinsurance scheme for the Northern Rivers region with the Commonwealth.

“In this current flood disaster, we are again faced with a large number of uninsured properties because households and businesses have been priced out of flood insurance,” Ms Saffin said.

Prime Minister Scott Morrison said the plan showed the government was listening to Australians who live in the north of the country.

Federal MP Kevin Hogan and Ms Saffin said they want to see the precedent set in Far North Queensland happen in the Northern Rivers.

“It is clear we need a similar scheme in the Northern Rivers region, given the scale of the flood disaster and the frequency of flood events here,” Ms Saffin said.

“The same issues that led to the creation of the northern Australia scheme apply to our region.”

Mr Hogan said he was speaking with peak insurance bodies.

“I want insurance companies to have heart,” Mr Hogan said.

Some insurance companies had shown goodwill and refunded last year’s premiums, he said.

“I will be making my thoughts known to the Insurance Council of Australia and I invite other survivors to do the same,” he said.

A house floating down the Richmond River near Coraki.

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