Hundreds of people have been forced to evacuate their homes in West Australia’s Kimberley region amid what has been labeled the State’s “worst floods”. It is expected that rebuilding everything that has been damaged could take months.

This article will discuss what part insurance plays in recovering from a natural disaster such as a flood.

Types of policies that could be relevant

There are a range of different insurance policies that someone affected by flooding may be able to rely on, for example:

  • Home and contents insurance
  • Car insurance
  • Income protection insurance
  • Public liability insurance (for businesses)
  • Business interruption insurance

Check your policy

Ultimately, what you are and are not insured for will depend on what your policy says. We recommend that you keep a copy of your policy documents, but if you don’t have a copy or cannot locate it, your insurer will have a copy.

When you are safely able to do so, you should take photos of any damage incurred so you can show your insurer.

Some things to look out for in your policy:

  • Whether you are actually insured for flood damage (or just storm water damage)
  • Whether you are covered for emergency temporary accommodation if your house becomes uninhabitable due to flooding
  • Whether you are covered for additional services such as architects, surveyors and the removal of debris from your property
  • Whether you are covered for loss of income if you are unable to work due to the flooding

Should you accept a cash settlement?

Some policies will allow the insurer to decide whether they will repair, replace or give a cash settlement. Sometimes the insurer will ask what you would prefer. After an event such as a flood, when there are potentially hundreds of people making claims, it may be tempting to accept a cash payment because it is the quicker option. However, if you accept a cash offer you should make sure you obtain independent quotes about the value of your damage and how much it will cost to repair/replace. You should also be aware that if the insurer repairs or replaces the damage, they will be responsible for the quality of the repair/replacement.

Parties effected by Cyclone Seroga in  Kalbarri and Northampton in May 2021 are still having difficulty engaging trades people to conduct repairs and clean up damaged property.

Not happy with how your claim is being handled?

If you have made a claim with your insurer and you are not happy with the way it has been handled, you are able to lodge a complaint with your insurer’s internal disputes department. If you are still unhappy after you have gone through your insurer’s internal process, you can also make a complaint with the Australian Financial Complaints Authority (AFCA).

Keep in mind that after a catastrophic event such as flooding, insurance companies and AFCA will be inundated with claims and complaints so it may take longer than usual to get a response.

We are still experiencing a number of substantial delays in various complaints with AFCA that we are advised is due to their workload from complaints associated with insurance disputes from the floods in eastern Australia in 2021.

If you would like any assistance or have any questions about your insurance policy or to handle a complaint, please don’t hesitate to contact Lynn & Brown for expert legal assistance.


About the authors: This article has been co-authored by Chelsea McNeill and Steven Brown. Chelsea is a lawyer that graduated from Murdoch University. Steven is a Perth lawyer and director, and has over 20 years’ experience in legal practice and practices in commercial law, dispute resolution and estate planning.


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