The Insurance Council of Australia (ICA) is today meeting with affected residents in flood-hit Inglewood, Queensland, to address their “confusion” in relation to how policies may respond when a flood occurs.

The policyholder session at the Inglewood Flood Recovery Centre comes as ABC News reports a number of businesses in the southern border town, whose premises were damaged by last week’s inundation, say they have insurance but aren’t covered for flood.

The situation mirrors that of the Townsville flood disaster in 2019 when it emerged many businesses caught up in the catastrophe did not opt for flood cover, sparking a torrent of criticism against insurers.

ICA says it is aware of some policyholder confusion around flood coverage in insurance.

“Many people affected in the Inglewood area are seeking an understanding of their insurance policy and how it responds to this severe weather event, as well as the next steps in the recovery process,” ICA CEO Andrew Hall said.

“The ICA representatives travelling to Inglewood from Brisbane will be available to help with general information around the claims process.”

After the 2011 Brisbane floods, a standard definition of flood was introduced in June 2012 that applies to home and contents, small business and domestic strata-title policies. Many businesses opt out of flood cover because of the high premiums involved.

The ICA says the standard definition of flood in Australia refers to the covering of normally dry land by water that has escaped or been released from the normal confines of any lake, or any river, creek or other natural watercourse, whether or not altered or modified, or any reservoir, canal or dam.

“Flood cover is a standard policy inclusion except where it is expressly stated cover for flood is excluded, for example where an insurer clearly states it does not cover flood, or when an option is provided to ‘opt out’ of flood cover,” the ICA said.

In the ABC News report, one of the affected Inglewood businesses owner said she was told by her insurer 11 years ago when she opened her café that she was not eligible for flood coverage as she was in a flood-prone area.

Another affected business operator said he has been in constant contact with his insurer about coverage and confusion over what is covered, his property or his business.

A broker in Queensland who has no clients in Inglewood says he would be very surprised if his customers are not aware of their flood cover position.

“It is a distinguished point of conversation we have with every client,” the broker, who did not want to be named, told insuranceNEWS.com.au.

Meanwhile insurers say they have received claims and are responding to the situation.

A spokesman for IAG says the insurer has so far received six claims across its brands from the Inglewood flood event.

“We’re still monitoring the weather at this stage and are continuing to support any impacted customers,” the spokesman said.

Suncorp Group Executive Manager Disaster Response Kahlee Ferguson says the insurer’s Customer Support Team is on the ground at the Inglewood Civic Centre to assist customers impacted by flooding.

“Customers of Suncorp Insurance, AAMI, Apia and Shannons can visit today and tomorrow between 9am to 4pm to speak face-to-face with our claims specialists,” Ms Ferguson said.

“The team can help customers lodge a claim and make arrangements for emergency funds, temporary accommodation and urgent repairs if required.”

A spokesman for Allianz says the insurer has received around 20 claims as of 2pm today.

“However we expect more customers to lodge claims in the coming week as flood waters recede,” the spokesman said.

“All claims received by Allianz will be honoured in accordance with our customers’ policy terms and conditions.

“Flood is an optional cover under Allianz’s home insurance policies and, in line with standard industry practice, small business and commercial policies.

“Flood damage is, therefore, not covered unless a policyholder chooses to add flood cover to their insurance policy and pay the commensurate additional premium.”

RACQ spokesperson Renee Smith says the insurer has 23 claims for Inglewood with most claims lodged for flooding to downstairs laundry areas and sheds, and some members reporting movement of stumps.

“We have sent a property assessor to Inglewood to assist members,” Ms Smith said.