Insurers reject flood of claims
By ANDY PARKS
LIKE many people in the Kyogle area, Brett Alvos and his family were badly hit by the floodwaters that ravaged the town last weekend. The water came through his downstairs entertainment room and lifted the polished floor boards, destroyed the pool table, the hi fi system and ruined his kids' toys.
"It wiped out the lot," he said.
It also took out a $10,000 fence, damaged the laundry and a mig welder.
As devastating as it was, Mr Alvos believed he was adequately covered for flood damage, but when he contacted the insurer Cuna Mutual, they told him he was not.
"When I first rang on Monday they didn't want anything to do with it."
Mr Alvos said he then discussed it with some of his neighbours who had insurance with the same company. They had all bought their insurance through the local Summerland Credit Union, who acts as a broker for Cuna, and believed they were covered for flood damage.
Mr Alvos said the words 'flood cover' appeared on the policy document next to both the 'home' and the 'contents' sections. Though another paragraph towards the bottom of the policy said the company would not pay for any loss or damage arising from a flood.
After speaking to another representative from Cuna, Mr Alvos said he was annoyed the flood cover had been taken out and he hadn't been informed.
"I have an automatic payment so the money comes out of my account every month. I don't have to sign a renewal every year," he said.
But Cuna Mutual Australia managing director Michael Tuffy said under the Insurance Contracts Act, all policy holders must receive a renewal and Mr Alvos would have been informed of the changes.
"We pulled away from flood cover in June 2006. On the front page of every renewal it says 'please be aware we no longer cover floods'."
Mr Tuffy said that very few underwriters in Australia allow for flood cover.
"A lot of houses in rural Australia are built in flood areas. It's a problem that we need to find a solution to and we will be taking this issue further in the future," he said.
Mr Tuffy said Cuna had sent a hydrologist to Kyogle to assess where water travelled from and the source of the water that caused the damage.
"We're still waiting to get the facts in front of us."
He said any insurance company that does offer a payout will classify the damage as 'storm' rather than 'flood'.