The aftermath of a natural disaster may not just involve extensive clean-ups and lengthy restoration projects. In fact, for some in Far North Queensland, the aftermath of Cyclone Yasi in 2011 has also meant dealing with hefty insurance premium hikes, some as high as 800 percent. One Cairns local saw his strata insurance increase from $3,600 to $36,000 following the natural disaster. According to him, this hike has caused the value of his property to drop by more than $50,000. It seems that he is not alone with an online petition calling for fair and affordable insurance premiums receiving more than 5,500 signatures. Shine Lawyers head of Disaster Insurance Recovery George Newhouse has put together these five tips for all property owners in areas prone to natural disasters facing insurance premium hikes.
- Shop around – Don’t accept exorbitant premiums. Shop around and take advantage of any competition in the market by comparing quotes and asking insurers to ‘do one better’ than their competitors.
- Limit the scope of your insurance – Have a close look at your insurance cover and reconsider any aspects or extras that aren’t necessary. Seek professional advice if you need it.
- Use an Insurance Broker – Seek out the assistance of a reputable insurance broker with the skills and experience to locate appropriate cover at competitive premiums.
- Apply for alternative arrangements – Where a body corporate is unable to comply with their legal requirements to insure, apply to the Body Corporate Commission to have alternative insurance arrangements put in place.
- Contact your local MP – Call on your local representative to look into the issue and consider whether wider government intervention is necessary. The options from here may be to call for an enquiry from the ACCC, request for the government to place a cap on the premiums that can be charged or provide funding to areas facing insurance hikes following natural disasters.
Written by Shine Lawyers. Last modified: December 18, 2013.