Huge jump in insurance premiums

ALLAN Abraham says the post-storm price he was quoted for renewing his home contents insurance with NRMA ‘frightened the living daylights out of me’.

The retired builder, whose Charlotte Court house flooded in the March 31 storm and was repaired under his contents cover with NRMA, said his yearly premium for home contents insurance with the company went up from $293.67 to $364.35 with storm cover, and $3688.19 with automatic flood cover.

Mr Abraham said a recent article about home insurance in a national newspaper had claimed that insurance would rise by 17 per cent because of floods and fires in three States but his quoted increase was 34 per cent for storm cover and more than 1000 per cent with flood cover. Mr Abraham was advised by the insurance company that his home had been classified as ‘may be at risk of flooding’ so he feared if he did not cover his home for flood, any future claim could be denied.

NRMA advised him that the increase reflected the risk of his home flooding, compiled from local council flood mapping, terrain data and insurance information.

A spokesman for the NRMA said Mr Abraham was under no compulsion to take up the more expensive flood cover; would have exactly the same coverage as before if he took the cheaper option and was free to challenge the assessment.

“When we introduced flood cover 98 per cent of our customers received it automatically with a minimal increase,” the spokesman said.

“We’ve taken information from a range of sources to work out where flooding is likely – this includes flood mapping from local councils, State Government terrain data, independent flood experts, the industry flood database and our own experience in managing these types of events.

Coffs Harbour mayor Keith Rhoades said he had heard of other premium increases from $700 to $1900 and from $1200 to $3800. Cr Rhoades said he had spoken twice this week to the office of the Federal Minister for Community Services, Jenny Macklin, and all completed flood surveys had been sent to her as requested.

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