What to do if your insurance claim isn't going to plan

We sincerely hope life following the floods is returning to normal, or at least there is light at the end of the tunnel.  Unfortunately for many that is not the case.  Having endured the physical and emotional turmoil of the event itself, many are now embarking on the next phase which can be just as stressful – the insurance claim.  But how can you take on an insurer if your claim does not go to plan?  Is it even possible to challenge or reverse an insurer’s decision without becoming embroiled in costly litigation?  Absolutely.  Here’s how…

We are fielding inquiries from affected parties about a huge variety of insurance issues: claims being rejected or contested, businesses who mistakenly thought they had flood cover, the scope of building work approved by insurers is insufficient, and some mysterious people called hydrologists providing reports used by insurers to deny claims. 

The Australian Financial Complaints Authority (AFCA) offers dispute resolution services to consumers and small business.  AFCA deals with a very broad scope of complaints about insurance including complaints about insurance brokers.  It can conduct negotiations between affected parties, make preliminary assessments of complaints and where all else fails make binding determinations.

Some of the advantages of the AFCA complaint process include:

• It is relatively quick and inexpensive when compared to other dispute resolution processes capable of producing binding outcomes (e.g. court proceedings).
• AFCA determinations are binding on the insurer but not on the insured. If you do not agree with an AFCA determination then there is nothing preventing you from taking the issue further for example by commencing a court proceeding. 
• AFCA Ombudsmen and Adjudicators are independent, qualified and highly-experienced decision makers. In making decisions they take into account legal principles, applicable industry codes and practice and previous determinations. 

 More information is available on AFCA’s website. 

We are now advising and assisting businesses and individual clients with:

• Challenging decisions of insurers to reject claims and where appropriate submitting AFCA complaints.
• The obligations of insurance brokers to advise customers about flood cover.
• The obligations of bodies corporate to arrange flood cover for common property.
• The obligations of lessors and lessees in circumstances of property damage.
• Issues with insurer-managed flood rectification work including scopes of works, engagement of contractors and dealing with defective workmanship.

Insurance disputes are often highly fact-sensitive and can involve difficult legal issues.  If you would like specific advice, give one of our experts a call.