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Bushfires - know your rights

A guide to getting your insurance claim paid

Lodging your insurance claim

Call your insurance company

It is important that you make contact with your insurer as soon as you can to lodge details of your property damage claim.

Remember, this can be done once you and your family are safe, even if you have not returned to your property or if you don't know the extent of the damage. This initial contact will get your claim started.

You don't need to have your policy paperwork with you - the insurance company will have electronic records. If you do not know who your insurance company is, you should contact the Insurance Council of Australia hotline and they will find out for you.

Your insurer will need to give you a claim number in respect of your claim. If you are not provided with a claim number by your insurer, or are being told you can't make a claim in relation to your policy, you should seek urgent legal advice.

Cleaning up your property

Insurance companies will usually want to assess the damage to your property before any repairs are done. Many companies will also want to approve the repairer you are using. You can go ahead with emergency repairs and clean-up if needed to make your property safe before your claim is assessed, but try to make sure you have clear 'before-and-after' photos and keep all receipts for the work that is done. If you can, try to contact your insurer before you start to let them know what you will be doing.

Temporary accommodation and other additional benefits

Your insurance policy may include payment for temporary accommodation costs and other additional benefits, such as demolition and removal of debris. These benefits are usually in addition to the sum insured amount of your policy (this means they will not usually be taken off the value of your claim). Temporary accommodation payments may be limited to a certain time period or a percentage of the sum insured amount. You should check your policy to see if you are covered.

When the insurance assessor visits

After you have made a claim, the insurance company will usually send out an assessor to inspect the damage to your property and prepare your claim. In areas where a bushfire has affected a large number of homes it may take some time for the assessor to attend, but the insurance company is still required to meet certain timeframes for your claim and to keep you informed of progress.

The insurance company may ask you to provide a list of all of your contents that were damaged or destroyed. If your home has been completely destroyed you may find it hard to make a list and it is generally considered unreasonable and unnecessary. If your insurer insists that you make a list you should seek urgent free legal advice.

If your home has not been completely destroyed, it may be reasonable that you make a list of what you have lost. This can be very difficult to do soon after a disaster, and you could ask the assessor to assist you. You do not have to provide formal quotes, store receipts, serial numbers or other unnecessary information about your items - if you have been asked to provide these unreasonably, get legal advice.

These tips might help:

  • Think about each room of your home and the items you had in those rooms, including carpets, curtains, furniture, clothing etc, and include all items that were damaged.
  • Don't forget to include items in garages and sheds.
  • Include as much information about the items as you can.
  • You may be able to provide other evidence of what you owned before the fire, such as earlier photos of rooms in your home.

If your claim is rejected, or paid out for less than you think it should have been, you should get free legal advice about your options.

Will my insurance policy pay?

An insurer has a legal obligation to assess your claim.

Whether your insurance policy will cover the damage to your property will depend on the words in the policy. For example, some policies state that the insurance company will pay for damage caused by fire, but not within the first few days of the policy or not for damage caused by fire-related damage such as scorching or melting where there was no flame.

How long does it take to get paid?

The insurer is required to decide the claim within 10 business days.

If they can't decide the claim in that time, they must contact you to let you know they need more information and how much more time they need.

Complaints about delays can be made to the Financial Ombudsman Service.

Urgent payment

The insurance company must fast-track your claim if you are in urgent need, like needing money to pay for emergency accommodation or to replace essential household items. If you can show that you are in urgent financial need, your insurance company has five business days to make an advance payment. Any advance payment will be taken off the total value of your claim.

Repair, replace or cash settle?

Often the decision as to whether to repair, replace or cash settle a claim is up to the insurance company. If you are offered a cash settlement of the claim, you should carefully consider whether the amount is sufficient to rebuild, repair or replace your property. You should also check whether the settlement amount will be paid to you or directly to your bank to pay off or reduce your mortgage.

After your claim is paid

If you are unhappy with your settled claim or any agreement you have reached with your insurer after a disaster, you can ask the insurer to review the settlement (for up to 12 months afterwards).

What can I do if my claim is rejected?

Lodge a dispute with the Financial Ombudsman Service

You can lodge a dispute with the Financial Ombudsman Service (FOS) if:

  • your claim has been rejected
  • your insurer is telling you that you can't make a claim on this policy
  • your insurer just won't make a decision on your claim

FOS is a free, independent body that has been set up to resolve consumer disputes. FOS processes are simple and easy to use.

FOS is expert in resolving insurance disputes, including disputes involving damage to your home where there has been a bushfire. They may also be able to speed up the resolution of your dispute if you are in severe hardship.

Do I need a lawyer?

FOS is a service for people who do not have lawyers. However, some insurance cases are difficult and may require the assistance of a lawyer. Legal Aid NSW can provide free advice and assistance. The Insurance Law Service may also be able to provide free advice and assistance with your FOS matter.

Who to call

Other helpful information

Bushfire Insurance Guide which can be downloaded from www.insurancelaw.org.au/fact-sheets.

You may also be eligible for government assistance to help you financially through this difficult period. Please contact your local Centrelink office for further details.

Jan 2015