Homes destroyed by bushfire

How To Prepare For A Bushfire Home Insurance Claim | CHOICE

With a third consecutive La Niña underway and many Australians affected by devastating floods for much of 2022, the risk of bushfires this summer appears low.

Unfortunately, this is not the case, as flooding and wet ground in many areas have encouraged increased vegetation growth. This means there is a higher risk of fires later this season, warns the National Council of Fire and Emergency Services.

Due to increased fuel loads due to heavy rainfall, higher than normal fire potential is expected in:

  • west-central and south-west Australia
  • Central Australia
  • southern queensland
  • interior of New South Wales.

Western Tasmania is also showing above normal fire potential after a period of dry spring.

“Natural disasters can be one of the most complex insurance issues to solve,” says CHOICE insurance expert Jodi Bird.

“There are simple things you can do right now to make it easier if you are hit by a bushfire and need to make a claim.”

1. Make sure your insurance documents are at hand

If you have hard copies of your insurance documents, make sure they are packed in your bag ready to take with you if you need to evacuate your home. Having hard copies on hand, as well as easy access to digital versions, will make it easier for you to consult if you need to speak to your insurer.

2. Check your coverage

If you’re not sure why you’re covered, now is the time to find out. Get to know your policy details inside and out, including what you might not be covered for. All of this information will be in your Product Disclosure Statement (PDS) given to you when you purchased coverage.

Keep in mind that many insurance policies have bushfire waiting periods, usually 48 to 72 hours.

If you think you want to purchase home insurance in the immediate future, keep in mind that many insurance policies have bushfire waiting periods, usually 48-72 hours. You will have to respect this waiting period if you were not insured before, if you renew your cover or if you increase your sum insured.

3. Take pictures of everything

When it comes to insurance claims, your smartphone is your friend. Take photos all over your home now – key property features, valuables, and anything else that can help you demonstrate the before and after.

Also take photos or make hard copies of all receipts for larger items in case you need to prove their value.

Store these photos in the “cloud”, which means you can access them anytime from any internet-connected device, wherever you are. If you need to make a claim and it is safe to do so, take many photos of the damage. Read our tips for finding a reliable cloud storage service.

4. Contact your insurer

Don’t bother making a claim until you and your property are safe.

Once you’re ready, keep in mind that many insurers can experience high call volumes, so be patient. You can contact your insurer by phone or online, depending on the circumstances and the claims process.

Whichever way you go about it, it’s important that you keep track of all the interactions you have with your insurer. If necessary, they will send someone to do the first safety repairs to prevent further damage. Our guide to making a home and contents insurance claim can help make the process less stressful.

How to file a complaint

If you believe your claim has been unfairly denied, contact the insurer’s internal dispute resolution team. If you do not get a satisfactory result, contact the Australian Financial Complaints Authority (AFCA).

Here are some other places to get help:

5. Prepare for next time

Bushfire claims can be particularly complicated. For example, has your property been directly affected by a bushfire? Did it catch fire as an indirect result? Were there flames on your property?

What if your property was burnt down but not completely burnt down? Or “only” smoke damage? What about partially burned houses or melted valuables?

“Fire cover” is a standard inclusion in home and contents insurance, but what does it actually mean? It turns out that what you’re covered for is defined in different ways.

According to Jodi Bird, “This lack of standardized terms among insurers means that claims can be subject to interpretation – which could end up giving you an unpleasant shock.”

Following our investigation in early 2020 following catastrophic bushfires in many parts of Australia, some insurers have made much needed improvements to their fire cover.

While fire cover would normally cover bushfires and grass fires, many insurers now also cover damage caused by heat, ash, smoke or soot from a nearby bushfire, even if your property is not directly burned. Be sure to check the PDS for more details.

Check that you have enough insurance to cover the cost of your home and all your possessions – and update your cover if necessary

You should also check that you have enough insurance to cover the cost of your home and all your belongings – and update your cover if you need to or look for a better deal.

Rising construction costs

Most insurers automatically increase your sum insured each year to account for inflation, but it pays to make your own assessment of potential rebuilding costs.

Labor and supply shortages attributed to the COVID-19 pandemic have increased construction costs, and rebuilding costs often increase after a natural disaster anyway, as demand for builders and materials increases when a large number of buildings have been damaged. Older homes that have been damaged may also need to be upgraded to meet higher building standards.

Take your insurer’s calculator with a grain of salt and consider getting an estimate from a builder or quantity surveyor.

Archive footage: Getty, unless otherwise noted.

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