Insurance claims are mounting up a week after severe storms lashed Melbourne causing widespread damage to cars, homes and commercial buildings.

According to the Insurance Council of Australia (ICA), insurers have received more than 71,000 claims with estimated insured losses of $460 million.

However, informed industry sources say the total could be much higher, particularly once commercial claims have been added, although reinsurance will most likely absorb much of the cost. 

Wild weather on March 6 saw huge hailstones wreak havoc on Melbourne homes, businesses, vehicles and contents.

MYI Freemans National Catastrophe Manager Brett White says policyholders in the Melbourne CBD and south and southeast areas of the city were particularly hard hit by the storm.

“It’s probably the biggest event we’ve had,” he told insuranceNEWS.com.au on Friday. “We’ve got 2700 claims and we think that will go out to more than 4000. We’ve got 75 adjusters on the ground, including 17 fly-ins from New Zealand.”

Of the insurers, IAG has received more than 24,000 claims in Victoria, mainly from customers of personal lines player RACV Insurance and commercial arm CGU.

The insurer has forecast claim costs from the event to reach its maximum reinsurance retention of $135 million.

Allianz Australia has received about 7000 claims in the wake of the storm, with spokesman Nicholas Scofield telling insuranceNEWS.com.au that total insured losses could reach $500 million.

“That would make the Melbourne event one of the largest storms in recent memory and the largest hail event since the massive Sydney hailstorm of April 1999,” he said.

Other industry insiders believe total claims could rise as high as the Sydney event, which cost $3.3 billion in ICA figures adjusted to 2007 values.

IAG has revised its full-year guidance in the wake of the Melbourne event, saying natural peril costs are now likely to exceed by $105 million its budgeted allowance of $184 million.

It has also refined its full-year insurance margin forecast to between 10.5-12% from 11.5-13%.

Fitch Ratings has estimated that Suncorp is likely to incur greater losses “given the group’s $200 million retention on its main catastrophe program”.

Insurers have meanwhile dismissed attacks by politicians (see ANALYSIS) and mainstream media that alleged inconsistency in their handling of claims.

“There is no question that damage caused by hail, rainwater or flash flooding due to excessive rainwater run-off is covered by Allianz’s home and motor policies,” Mr Scofield said.

Budget Direct, which has received more than 1500 claims, has announced customers’ no claims bonuses will not be affected as a result of the storm.