Consumer advocates say insurance companies are ripping off vulnerable customers with low-ball cash settlements to fund repairs on flood-damaged homes, and regulators and governments are taking notice with the latter backing changes to the industry code of conduct to boost protections against the practice.

Thousands of households in NSW and Queensland are still cleaning up after the devastating floods in April and May. “We hear appalling stories about insurers pushing cash settlements onto customers who are clearly vulnerable,” says Financial Rights Legal Centre senior policy and advocacy officer, Drew MacRae.