Most people living in bushfire-prone areas are unaware they are underinsured since more stringent building regulations were introduced, according to Legal Aid NSW.

It says many Blue Mountains residents hit by last October’s fires have found they do not carry enough insurance to meet higher rebuild costs.

The national building code was amended after the 2009 Victorian fires to give a “bushfire attack level” rating to properties in areas at risk, imposing new requirements on building design and materials.

Legal Aid NSW says insurers should be required to tell consumers of the higher rebuild costs, a view supported by the Blue Mountains City Council.

However, the Insurance Council of Australia says insurers do not have that level of information, and it is up to councils to tell residents about changes to zonings and the potential impact on building costs.

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