Australia’s market grapples with extreme weather claims, Covid-19April 1 2020 by Yvonne Lau
This year, Australia’s sector will need to grapple with a significant double burden from the Covid-19 impact and the recent season of extreme weather, says the Insurance Council of Australia (ICA).
The recent summer season took a toll on the Australian market – bushfires burned over 13 million hectares of land in New South Wales and the Australian Capital Territory alone. “Insurance companies and brokers are dealing with an extraordinary [impact] from more than 252,000 claims worth A$4.6 billion (US$2.82 billion),” says Campbell Fuller, an ICA spokesperson.
Most recently, the east coast low that struck Australia in February will cost (re)insurance players an estimated A$794 million (US$484.3 million), according to Perils.
In terms of the current Covid-19 outbreak, general insurance has been deemed an essential service by the government, thus new regulations will not restrict their operations. However, the ICA says it is not “business as usual — far from it. Covid-19 is having a dramatic impact on the operations of most businesses; and it is inevitable [that] many customers will experience delays and interruptions.”
ICA noted that its member companies are seeking to assist SME and household policyholders on an individual basis — particularly those struggling with financial hardship.
The council is seeking further clarity from governments at the federal, state and territory levels on essential services arrangements; and set up a coronavirus-specific taskforce to deal with related issues and claims.
For neighbouring New Zealand, the country’s insurers and the Insurance Council of New Zealand (ICNZ) have similarly pledged “sector-wide support… during the Covid-19 crisis.”
Tim Grafton, chief executive of ICNZ said: “[The sector] is still very much open to support its customers and their claims. As an identified essential service, customers can have confidence that insurers will continue to help [them] — regardless of where or how their staff is working.”
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