Insurance tips

Who put the "FU" into CGU?
The following provides key consumer information on insurance cover for floods.

Am I automatically covered if my house floods?
No. Not all policies cover floods. You need to check your individual insurance company.  A recent review of home and contents insurers by Choice found that 19 of the 43 insurers offered flood insurance, five offered it as part of additional coverage and 19 didn't offer it at all.

What type of flooding can I be insured against?
Flooding can be divided into three categories:

(1)  Flash flooding/stormwater/rainwater runoff caused by high intensity, but short duration storms producing localised flooding. The majority of insurance policies cover this type of inundation risk.

(2)  Riverine/Inland Flooding/Flooding caused by river, creek or artificial catchments like dams overflowing their banks due to long duration rainfall. Many insurance policies do not cover this type of flooding.

(3) Actions of sea/sea level rise/storm surge. This normally refers to inundation caused by the movement of sea water and can include king or high tides. There is very little cover available for this risk.

How do I find out if I am covered?  Read your Policy Disclosure Statement, if you are still unsure discuss the extent of your cover with your insurance company. Don't just assume you are covered.

Is flood insurance available for every property in Australia?
No. Flood insurance is available in many parts of Australia, but you will need to check with individual insurance companies.

How do the insurance companies determine the flood risk of my property?
A big database called the National Flood Information Database, which has 11.3 million properties listed, is used in conjunction with government flood mapping .

How much will it cost?
The cost is usually worked out by looking at the actual risk of flooding and the value of assets you wish to protect.

How do I know if my home is at risk of flooding?
Ask your local council or flood plan management authority.

RACQ Evil Conmen - The sign on Brisbane
 Terrace Goodna after the 2011 flood says it all.

Article source: The Insurance Council of Australia and Choice

Guide to buying the best
insurance to cover all bases.

A good insurance adviser will have
an eye for your personal situation.

INSURANCE is one of those things that we don't miss until we need it.

Sure we bemoan the monthly outgoings for a "just in case" but there is usually a sigh of relief if the unfortunate situation does eventuate.

The six main forms of insurance, well in Australia at least, are policies for motor vehicles, home and contents, businesses, mortgage protection, workers compensation and travel.

There are hundreds of companies offering insurance products to consumers with each product having its own set of exclusions and requirements.

It is difficult to know where to start.

Motor vehicles

As with any insurance policy the best one is the one that best suits your needs and circumstances.

Motor vehicle insurance is usually made up of a number of components including bodily injury liability, property damage liability, medical payments, uninsured motorist protection, collision coverage and physical damage.

It is vital that you don't choose your cover on price alone as being underinsured is sure to cost you in the long run but in this competitive market you can have a policy tailored to your specific needs.

All drivers must have compulsory third party insurance but then it's up to you as to what else you want included.

Prices differ according to the type and age of the vehicle you own, where it is stored, if it is used for business, which is driving it and whether it has been modified.

So consider your circumstances and think out of the box.

If you don't drive your car that often you may consider a "Pay as you drive" policy or if you have retired maybe look into companies that support a specific age group.

Most insurers also offer multi-policy discounts when you hold other policies with them.

House and contents

Your home is very likely your biggest asset and the treasured possessions within will be difficult to replace without insurance.

If you have taken out a mortgage to secure your property the bank will insist on insurance but don't feel pressured to go with the broker they suggest.

Shopping around may net a better price.

You will have to decide whether you want "total replacement" cover or "sum ensured" cover but use accurate estimates of the rebuild cost of your home as this will affect the price and it is often better to slightly overvalue your contents than opt for the other end of the scale.

Keep in mind that if your home is destroyed you will need money not only to replace it but for supplementary costs like alternative accommodation, removal of debris and lodging plans with council.

Often insurance companies will cap the amount valuable items are covered for so for example items like jewellery or electronics may have a maximum payout of $5000.

If you have items that are quite valuable consider insuring them separately.

Be sure to check on flood coverage and what constitutes a flood for the sake of the policy and also things like whether your home is covered if you are away for long periods of time.

If you work from home you will need to have a separate business insurance policy to cover damages in your home office.

Take photos of your possessions, particularly in the room in which they are placed as this will help support any claims you may make, if you lose them or they become damaged.


If you do not have private insurance with hospital benefits and you earn over $84,000 ($168,000 for couples, families and single parents) you will have to pay an extra 1% Medical Levy Surcharge in addition to the 1.5% you already pay in your tax.

That and an overextended public system are just two reasons to consider health insurance.

Most people tend to opt for hospital and extras cover which will look after services like dentistry, physiotherapy, optical and alternative therapies.

There is great variation in what is covered and the rebates involved so make sure your research is thorough.

If you have already had your family for example you could exclude maternity care while young healthy singles may have little use for hip replacements.

Also, you can use a different provider for your hospital cover from the one you choose for extras depending on which offers the services you need.

There are so many providers on the market now that it wouldn't hurt to do comparisons.

Did you know?

There is documented evidence that Chinese and Babylonian traders began to protect themselves against risk as far back as the third century BC by spreading their goods among multiple vessels to avoid chances of complete loss.

In later years, ship masters in Great Britain reasoned that if 100 ship owners each chipped in money the money collected could be used to repair or replace the few boats that were damaged or lost.

Extreme losses following the Great Fire of London in 1666 led to the creation of the world's first actual insurance company, The Insurance Office, or The Fire Office.

In the US, the first insurance company was started in Charleston, South Carolina in 1732. Benjamin Franklin is recognised as helping to make insurance popular and to standardise the practice of insurance.