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Choice’s ‘loose wordings’ accusations draw industry fire

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Insurers have strongly rejected accusations from Choice that the industry uses “loose and complicated” wordings to define fire cover in home policies.

The consumer group says it has found exclusions in some policies that specify damage must be caused by flames, and exclude issues caused by smoke, ash, melting or scorching.

But a spokesman for Suncorp Group, which saw its home products earn a “bad” score from Choice, has described the claims as “scaremongering”.

“We have had no issues with our customers impacted by the recent bushfires,” the spokesman told

“Where there is fire damage to the home, including boundary fences, tanks or sheds, we cover damage including heat, ash, soot and smoke.

“Choice did not take the time to clarify how this works in the real world, and therefore has failed to accurately inform consumers.”

The Insurance Council of Australia (ICA) has also reacted strongly, with spokesman Campbell Fuller calling the consumer group’s assertions “unnecessary and unjustified”.

“No concerns about policy wording as suggested by Choice have been raised with ICA,” Mr Fuller said.

“Choice has not been able to provide any examples of detrimental consumer outcomes nor did it provide its findings to ICA.”

According to Choice, its review of 26 major home and contents products found 70% of the policies have confusing, unfair or unclear fire definitions.

Three Suncorp brands - AAMI, Apia and GIO - were ranked as “bad”, along with QBE. The other brands that made it to the “bad” list are IAG-backed Coles home cover, Budget Direct, ING and Virgin Money.

Coles Insurance did not directly address the claims, with a spokesman saying the business “continually reviews how best we can support our customers”.

“Our team works hard to help our customers understand the risk they face, prepare their homes and properties, and choose the appropriate coverage for their needs,” the spokesman told

Home covers from Allianz and its Territory Insurance Office brand made it to the “good” list, as did ANZ – whose product is issued by QBE – as well as IAG-owned CGU and CommInsure.

Choice CEO Alan Kirkland told the issue “should be no surprise to the insurance industry”.

“Consumer advocates and financial counsellors have been raising the issue of the problematic definition of fire for a number of years,”

“We are aware of cases following the tragic 2009 Victorian bushfires where claims were denied based on terms similar to those we have highlighted today.

“Our insurance experts were pleased to find some insurers who have simple, clear, and fair definitions of fire. Choice would like to see the rest of the industry follow suit.”