Business owners are now more aware of how a natural disaster can affect their operations but the insurance industry can do more to help them prepare, according to panellists at an Australian and New Zealand Institute of Insurance and Finance (ANZIIF) event.

The ANZIIF Victorian executive breakfast series on lessons learned from last year’s catastrophes heard how brokers, underwriters and insurers should be working more closely with clients and each other.

Panellists from Marsh, CGU and restoration company Steamatic agreed that after the Queensland floods, business-owners understand how they can be affected by supply chain disruption and brokers and insurers are more attuned to contingent business interruption issues.

Marsh Victorian State Executive Corporate Paul Bradley says the floods also highlighted the importance of clients understanding the need to keep records of losses immediately after an event.

He says as the market hardens, underwriters expect brokers to provide more information from clients about exposures related to catastrophes, and brokers have gained a better understanding of clients’ businesses.

He has since organised “pre-loss workshops” for major corporates, underwriters and claims managers to work through likely scenarios and how the cover responds. He says the workshops foster a more harmonious relationship prior to any loss occurring.

Marsh Claims Manager Richard Lance told the seminar it can be a false economy not to engage more claims staff early on.

“You are better off investing in people and dealing with these issues in the first few months of a claim,” he said.

He also suggests offering intermediate payments earlier to take the sting out of disputes.

“If you have reserved for $20 million, why can’t you give them $3 million or $4 million on day one? It buys you time as well,” he said.

Steamatic CEO Oliver Threlfall says he was horrified during the floods at how little people knew about restoration, throwing out items such as wedding albums that could have been restored.

The sight of such property dumped on nature strips prompted Steamatic to begin working with local governments to help residents understand that property can be restored.

Panellists say they have seen a spike in interest around business contingency planning following last year’s catastrophes. 

CGU’s GM Claims Donna Walker says more work could be done with small to medium-sized business owners, who are often “living in the moment”, making decisions based on their day-to-day cash flows and unaware of the extent of their risks.

She says the floods showed the community’s lack of understanding of insurance cover. The panellists say the industry needs to be more vocal about the role of insurance in contributing to recovery.

Ms Walker says while CGU staff focused on dealing with claims efficiently and quickly during the Queensland floods, with the benefit of hindsight more emphasis should be put on communication to explain cover and work through difficult messages with customers who may be experiencing frustration, grief and anger.