Parliamentary Inquiry into the 2022 Qld and NSW Floods.
Lawmakers demand answers! An investigation into insurers’ handling of major flood claims.
On August 7, 2023, the House of Representatives referred an inquiry to the House of Representatives Standing Committee on Economics. This inquiry will focus on insurers’ responses to the devastating floods that occurred in South-East Queensland and northern NSW in February and March 2022.
In June 2023, the Insurance Council of Australia (ICA) released its findings on the devastating February-March 2022 floods in South-East Queensland and New South Wales. The floods have resulted in a staggering $5.87 billion in insured damages.
The inquiry will delve into the preparedness of insurers in effectively responding to the increasing frequency of such events. It will also address critical issues such as skills, labour shortages, claims handling, and communication with policyholders before, during, and after these catastrophic events.
Considering the gravity of the situation, the Assistant Treasurer has personally visited the impacted communities alongside members of Parliament. The inquiry was officially announced after witnessing the devastation in Central West NSW last month.
The Albanese Government has now unveiled the terms of reference for the inquiry.
- To ensure accurate representation and gather vital information, the committee will hold public hearings in regions affected by the 2022 floods, allowing affected communities to share their experiences. A final report is scheduled to be released during the third quarter of 2024.
- The objective of this inquiry is to provide valuable insights that will guide the Albanese Government in its efforts to address insurance accessibility and affordability. As part of this endeavour, the government plans to invest up to $1 billion over the next five years, through the Disaster Ready Fund, to enhance measures that protect homes and communities from extreme weather events.
- The government is committed to taking proactive steps to mitigate disaster risks and promote the development of climate-resilient communities. Presently, a mere 3% of disaster funding is allocated to risk mitigation, with the overwhelming majority of resources (97%) dedicated to recovery. The government aims to reverse this imbalance.
- The terms of reference for the inquiry cover a wide range of topics, including insurers’ response to claims resulting from various flood events in 2022, as well as policyholder experiences before, during, and after making claims. The inquiry will also consider obstacles to claims resolution, insurer communication, accessibility and affordability of relevant reports, and the impact of land use planning decisions on insurance availability and affordability.
- Additionally, the inquiry will draw on previous reports, such as Deloitte’s external review of insurers’ responses to the 2022 floods, and ASIC’s Claims Handling review, to inform its findings and recommendations.