A landlord who challenged his insurer over an increase to his annual premium of more than $3500, primarily due to his property’s heightened flood risk, has lost a bid to be refunded.

The complainant’s policy was renewed in December 2022, with the annual premium rising from $1520 to $5087.

The landlord said he was initially unaware of the price increase, arguing Allianz Australia took the higher sum without his consent. After discovering the premium change, he cancelled the policy last November and sought a refund for $3300 of monthly payments.

The insurer said it had provided a renewal notice that specified the new monthly instalment at least twice on the front page, including one instance in bold.

It said the policyholder had previously arranged for automatic renewal and the notice informed him to contact the insurer if he did not want to renew.

The complainant acknowledged he received the renewal notice, but said he “skim read” it, because he had received a lot of emails around that time.

He said Allianz should not have been allowed to increase the premium by more than 200% without his written or verbal consent.  

The landlord also disputed the insurer’s decision to add cover for loss of rent and tenant damage to the policy, which increased the premium. He said he would not have consented to that if he knew it would raise the price.  

While acknowledging that the insured property was a flood risk, the man also said Allianz had not explained why the risk had increased.  

The Australian Financial Complaints Authority’s ruling on the dispute says Allianz has included mandatory cover for malicious damage and loss of rent since March 2021, and it was up to the complainant to seek alternative insurance if he did not want to pay for this.  

It says the insurer reviewed its flood portfolio in 2022 and the insured property fell under the highest risk rating as part of that assessment. This was reflected in similar premiums offered to nearby properties.  

The authority notes other insurers offered the policyholder much lower premiums, but says this cannot be considered in weighing whether the premium rise should be refunded.

“The available information does not show the insurer calculated the premiums incorrectly, or misrepresented or failed to disclose the premiums to the complainant,” the authority said.

“Considering these factors, there is no basis for AFCA to require the insurer to refund premiums paid for cover already provided to the complainant.”  

Click here for the ruling.