Posted by Robert Cooper on Oct 30 2013
by Meenal Kumar | Broker Buzz 30 Oct 2013
The insurance industry is earning plaudits for its response to the NSW bushfires, with some small business claims being paid within an incredible one-hour timeframe.
Broker Buzz spoke to one Penrith-based broker who put in a general property claim on behalf of a client at 9:45am on Monday morning and had the final paperwork settled on the claim by 10:45am the same day.
“The claim was worth $5000 and covered tools the client uses in their business,” the broker says.
“The insurer responded swiftly to ensure our client was back on his feet as quickly as possible.”
This response and many like it have earned the industry high praise by NSW Bushfire Recovery Co-ordinator Phil Koperberg, who says: “The insurers are doing the right thing. They’ve been more than reasonably helpful in the main and I’ve not heard of any exceptions.”
“They have been very, very responsive. I know that a number of claims have already been settled.”
Insurance Council of Australia (ICA) CEO Rob Whelan says insurance assessors have already visited nine out of 10 damaged properties, with well over 1000 claims made so far.
“Insurers have responded incredibly quickly and we believe this is in the best interests of residents and business owners affected by the bushfires,” he says.
The ICA is holding a second insurance forum for Blue Mountains policyholders on November 12 in Springwood, involving insurance companies, the Financial Ombudsman Service and NSW Legal Aid.
The Blue Mountains Council will also be present to discuss rebuilding standards.
Although the claims cost tallied so far is more than $145 million, the costs to thousands of business in the Blue Mountains and Southern Highlands region is likely to be far higher, as the do the math on their lost trade.
Evacuations, road closures and supply disruption have all taken their toll on earnings, creating a situation where business interruption cover can be a business saviour.
After the Black Saturday fires in Victoria in 2009, many businesses with business interruption cover were able to claim losses even if there was no physical damage to their premises.
However, selecting the right cover for clients is essential. Business interruption extensions such as loss of attraction or prevention of access are vital to helping physically unaffected business weather any downturn in trade caused by road closures or evacuations.
Meanwhile, the NSW Government has also announced new measures to protect financially fragile businesses in the aftermath of the disaster by deferring Workers Compensation insurance payments.
Minister for Finance and Services Andrew Constance says: “Any eligible business affected by the bush fires who have an insurance premium due to be paid from between 14 October 2013 and 31 March 2014, will have that payment period extended until 30 June 2014.”
“This is an initiative which has the potential of helping more than 15,000 businesses in the Blue Mountains and Hawkesbury, and more than 24,000 businesses across the entire state.”