The Bureau of Meteorology has warned the public about summer’s heatwaves making a return this autumn, which could cause more bushfires.
But the crazy weather doesn’t stop there. Just recently, parts of Sydney and Wollongong were hit by a hailstorm, causing $31 million in damages and over 12,000 insurance claims.
Due to recent incidents, the Insurance Council of Australia have urged the public to check if they are covered.
“Insurance that protects against bushfires, floods and other natural disasters is available to all Australian households, regardless of location.
“Households shouldn’t wait until a disaster is imminent to buy insurance,” Campbell Fuller, ICA spokesperson said.
ICA data revealed that 1.75 million Australian land parcels have some degree of bushfire exposure.
“Your insurer should be able to provide some guidance as to what hazards your property faces. Local government can also be an invaluable source of information. Councils hold the most detailed flood data, as well as maps of local bushfire-prone land,” Mr Fuller said.
For Australians, all home building and contents policies cover damage from bushfires, while 95 per cent of policies include cover for flooding.
Mr Fuller works for ICA’s financial literacy initiative Understand Insurance. The expert explained how home and contents insurance works.
“General insurance is risk-rated, which means premiums are calculated based on the risk that the policyholder will need to make a claim.
“If your home is in the midst of thick bushland or perched on a riverbank, your premium will be higher than if the same home had no bushfire or flood exposure.
“One of the most pressing issues for policyholders in bushfire prone areas is making sure they’re not underinsured. In the aftermath of the New South Wales Blue Mountains bushfires of 2013, it emerged some residents hadn’t bought enough insurance cover to rebuild their homes.
“Many Australian households are unaware if their home has been rezoned, and whether it affects their insurance needs. Homeowners can contact their local council for guidance on bushfire zoning,” Mr Fuller said.
The government initiative Money Smart outlines that home insurance and content insurance are separate policies but can be bundled.
The website also notes that there are two types of home building insurance: Total replacement cover and sum-insured cover.
ICA advises homeowners to keep updated about inflation, rising construction costs and to review the sums of their home and contents.
