Insurance claims flow in from east coast floods

The Insurance Council says members have received 96,844 flood claims on the east coast, for an estimated $1.45bn. Almost all are for domestic property and vehicles.

Flood water rising next to a house beside the Georges River in Sydney's south-west on Tuesday. Picture: Getty Images

The Insurance Council says its members have received 96,844 claims related to major flooding along the east coast, costing an estimated $1.45 billion and almost all for domestic property and vehicles.

This represents a 12 per cent increase on the number of claims filed by Monday, driven by a 23 per cent increase in claims from NSW. Sixty-nine per cent of claims are from Queensland and 31 per cent are from NSW.

Across both states 80 per cent of claims are for domestic property, 17 per cent for motor vehicles, with the remainder commercial property claims.

Based on previous flood events the estimated current cost of claims is now $1.45bn. This figure remains subject to detailed assessment of claims as loss adjusters move in over the coming weeks and is expected to increase as further claims are made.

Under insurance catastrophe protocols agreed to by the industry, insurers prioritise the most urgent and most vulnerable customers when assessing claims.

This means some customers whose situation is not as urgent or severe may wait weeks until an assessor reviews their claim.

Despite the more recent rise in claims, analysts at Credit Suisse said the listed sector had shown top-line growth in the first half of the financial year, and margins had begun to improve.

“Ongoing premium rate increases are continuing to translate into higher margins for the listed insurers,” wrote the investment bank’s analysts Doron Kur and Supun Wijerathna.

Their investment preferences for the sector include QBE, Suncorp and IAG.

QBE shares rose 4c on Tuesday to close at $10.12, nearly 10 per cent lower over five days.

Suncorp shares ended lower, down 9c to $10.19. They are down more than 7 per cent in five days.

“Revenue growth across the general insurance sector picked back up, largely due to continued higher rate increases with volume loss less pronounced in some lines,” wrote Credit Suisse’s Mr Kur and Mr Wijerathna.

Originally published as Insurance claims flow in from east coast floods