Uphill Battle for payouts - October 2010 Floods

WAGGA DAILY ADVERTISER Thursday 21 October 2010

"Residents without specific flood insurance will face an uphill battle to secure any payout after the weekend's events, says one legal expert.

Rob Stone, Solicitor Director from Commins Hendriks yesterday urged residents to read the fine print of their insurance policy and sought to debunk the rumour that the announcement of a natural disaster zone meant automatic payout.

'That's not the case.......people will need to have a very close look at their policy' he said.

Mr Stone said attention to the debate may now be over whether this is a flood or simply a 'rain event'. While some insurance policies include protection against floods, many simply cover 'storm and tempest' - a difference which could determine how insurers approach funding.

'You may have a case where you get a downpour and the gutters don't cope and it gets into your ceiling - that's storm and tempest' Mr Stone explained. Yet if rain fills a river which then floods a home, it is considered a separate flood event not included in many insurance policies, a finer point likely to catch many residents unaware.

As yet, there is no common definition for 'flood' by Australian insurers with each company able to adopt its own interpretation of the term and how it will cover it.

Commins Hendriks Solicitors has already taken on clients from Wagga and the Tumut area who are having issues receiving payment from insurers.

In some cases where there is uncertainty over policy terms, insurance agencies may offer partial compensation if a client signs a discharge notice, stopping clients from pursuing the matter further. Mr Stone strongly urged people in this situation to be careful. 'People would want to be very comfortable with their recompense before they signed anything' he said."

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