Insurers Face Intense Scrutiny Over Quake Claim Rejections
Insurers Face Intense Scrutiny Over Quake Claim Rejections
Muswellbrook Shire Council conducted a survey among residents after the quakes, identifying extensive structural damages and a community riddled with anxiety. The survey, reflecting feedback from about 200 participants, showcased a troubling pattern: more than 50% of claims have been turned down by insurers.
Contrary to local concerns, the Insurance Council of Australia (ICA) maintains that insurers are diligently processing claims. The ICA anticipates that most unresolved claims will eventually receive full or partial settlements. An ICA spokesperson clarified in a statement to insuranceNEWS.com.au, “When assessing a claim relating to an earthquake, insurers engage expert engineers to assess potential damage.”
Such diligence, however, has done little to placate local leaders like Mayor Jeff Drayton, who remarked, “The response from insurance companies has been a joke. They have taken so long to assess the claims, only to reject them, leaving people in limbo and wondering what’s the point of insurance.”
This issue isn't isolated, echoing precedents such as the significant Victorian earthquakes in 2021. These earlier events also saw numerous claims lodged, with many resulting in rulings favorable to the insurers from the Australian Financial Complaints Authority.
Typically, homeowners might discover minor, pre-existing damages only after scrutinizing their homes post-quake. Insurance often does not cover such pre-existing conditions, contributing to a rise in rejected claims. As noted by industry reports, while earthquake damage tends to be included in home policies, ambiguous cases caused by routine earth movement or thermal expansion present challenges.
The ICA emphasizes the capacity of expert engineers to “easily distinguish” genuine earthquake damage from other types of defects. Yet, those dissatisfied with insurance outcomes have multiple recourses. Customers may initiate internal disputes, and if unresolved, escalate them to the Australian Financial Complaints Authority.
An underlying concern, though unproven, attributes these seismic events to nearby coal mining operations, raising questions about insurance policies' concordance with evolving geological realities.
With residents increasingly aware and anxious, the ball is in the insurers' court to restore trust. How swiftly and equitably these claims are resolved might well define insurance responses to future, inevitable natural calamities.
Published:Thursday, 21st Nov 2024
Source: Paige Estritori
Share this news item:
| Insurers Face Intense Scrutiny Over Quake Claim Rejections 21 Nov 2024: Paige Estritori In recent months, Muswellbrook, a town in New South Wales, has experienced a series of earthquakes that have left residents grappling with both physical destruction and emotional distress. Criticism is mounting against insurers as more than 600 claims have emerged, following these seismic events, yet many remain unresolved or denied. - read more |
| AI Regulations: A Web of Complications 20 Nov 2024: Paige Estritori The Insurance Council of Australia (ICA) has raised concerns about the potential fallout from a fragmented regulatory approach to artificial intelligence and automated decision-making in the industry. There is fear that this patchwork of reforms could result in conflicting requirements, heavier compliance burdens, and increased industry confusion. - read more |
| APRA Survey Reveals Impact of Climate Change on Insurance Industry Practices 19 Nov 2024: Paige Estritori A recent analysis by the Australian Prudential Regulation Authority (APRA) reveals that over 90% of general insurers and reinsurers anticipate climate change will influence their underwriting procedures, posing new challenges to the industry. - read more |
| Fraudulent Claims Lead to Complete Denial of Compensation 18 Nov 2024: Paige Estritori In a remarkable case highlighting the severe consequences of insurance fraud, an individual's attempt to inflate a theft insurance claim has resulted in the total denial of compensation. Despite a significant portion of the claim being genuine, fraudulent actions negated any potential payout. - read more |
| The Importance of Comparing Health Insurance Extras for Maximum Savings Health insurance is more than just a precautionary measure; it's a vital component in managing both your health and financial well-being. In Australia, where healthcare costs can quickly escalate, health insurance extras serve as a buffer, ensuring that services like dental, optical, and physiotherapy remain within reach. These extras can significantly reduce the out-of-pocket expenses you might otherwise encounter for non-hospital treatments. - read more
|
| 5 Tips to Save on Health Cover as an Australian Senior Finding the right health insurance coverage is a critical concern for Australian seniors, who often face the dual challenge of managing chronic health conditions and maintaining financial stability in retirement. As the cost of healthcare continues to rise, the importance of securing an affordable health cover that still meets their needs cannot be overstated. - read more
|
| How Life Insurance Provides Financial Security for Your Loved Ones Life insurance is a crucial part of any comprehensive financial plan, providing peace of mind that your loved ones will be financially secure in the event of your passing. - read more
|
| Maximize Your Safety Net: Top Tips for Optimizing Income Protection Benefits Welcome to a pivotal guide dedicated to empowering you with the essentials of income protection insurance in Australia. As we navigate through times of uncertainty, safeguarding your financial wellbeing becomes not just a priority, but a necessity. Income protection insurance stands as one of the key pillars of financial security, ensuring a steady flow of income during periods when you're unable to work due to illness or injury. - read more
|
The primary cause of loss in an insurance claim, which sets in motion a chain of events leading to the damage or injury.