Insurance claims spike and many more expected amid ex-cyclone Alfred clean-up

Insurance claims have spiked as the clean-up from ex-tropical cyclone Alfred continues, with more than 22,000 policyholders reporting damage to homes, vehicles, and commercial properties.

The bulk of the claims are from flood-hit south-east Queensland. However, claims from northern New South Wales are expected to increase in the coming days as areas reopen, according to the Insurance Council of Australia.

While the council says it is too early to say how much the total damage bill from Alfred will be, S&P Global Ratings has previously estimated it at more than $2 billion.

Policyholders in Queensland have submitted 20,665 claims, while 1735 claims have been lodged in NSW.

Most claims relate to damaged homes (20,460) followed by vehicles (1182) and then commercial properties (758).

Council CEO Andrew Hall said claim numbers were rising daily with people assessing the damage to their properties and businesses.

“Insurers are committed to prioritising claims made by customers affected by this ongoing weather event,” he said.

“Today’s spike in claims was very much expected and in line with this stage in the recovery process as people start the clean-up process and get back to their homes to assess the damage.

“Where possible though, we do encourage impacted policyholders to lodge a claim with their insurer, even if the full extent of the damage isn’t yet known.”

The costliest cyclone to hit Australia remains Cyclone Tracy in 1974, which in today’s terms would be the equivalent to $7.4 billion in claims.

The floods of early 2022 remain the costliest insured event in Australia’s history with $6.4 billion in insured losses across more than 245,000 claims.

In a written statement, the council said it was too early to predict what impact ex-cyclone Alfred would have on premiums.

“However, the frequency and severity of natural disasters has increased in recent years and this is contributing to higher premiums.

“Insurers have been calling on governments to invest more in resilience and mitigation to protect the many Australians who are living in harm’s way and improve insurance affordability and availability — as outlined by our call for a Flood Defence Fund in our Federal Election Platform released in February.”