Weather-Proofing Your Finances: Insurance Essentials After Recent Cyclone Events
The recent cyclone that swept through NSW and QLD has been a stark reminder of how quickly our financial security can be threatened by forces beyond our control. While we're thankful the impact wasn't as devastating as it could have been, many Australian families are still dealing with flooding, property damage, and the stress of navigating insurance claims.
As a financial coach, I want to ensure you're protected not just from natural disasters, but from the potential pitfalls of inadequate insurance coverage. Let's dive into some critical aspects of insurance you should review today.
“The best time to review your coverage isn’t after the storm, but during the calm that precedes it.”
Home Insurance Review Checklist
1. Coverage Specifics Matter
Verify flood coverage includes all types (riverine, flash flooding, storm surge)
Confirm wind and storm damage protection, including for fallen trees
Check temporary accommodation allowances if your home becomes uninhabitable
Review contents coverage and keep an updated inventory with photos
2. The Fine Print Can Cost You
Look for exclusions specific to weather events
Check for waiting periods before flood coverage activates
Understand how your insurer defines "flood" versus "storm damage"
Review coverage caps and sub-limits for certain types of claims
3. Broker Benefits: Worth Considering Working with an insurance broker can be invaluable, especially for complex properties or unique circumstances. They provide:
Access to multiple insurers and policies
Personalised risk assessment
Expert guidance through policy complexities
Time savings from not having to research multiple policies yourself
Budget Planning for Insurance
Create an Insurance Sinking Fund
Set up a dedicated savings account for insurance premiums
Divide your annual premium costs by 12 and save this amount monthly
Add 5-10% extra to account for potential premium increases
Having funds ready when renewal comes means you won't be forced to accept unfavorable terms due to financial pressure
Review Your Insurance Calendar
Mark all policy renewal dates in your calendar with 6-week advance reminders
Schedule your insurance shopping period when you're not busy with other financial obligations
Align your insurance review with your annual financial check-up
Money-Saving Insurance Strategies
Increase Your Excess Strategically Raising your excess (deductible) can reduce your premiums by approximately 10%. This strategy works best if you:
Have adequate emergency savings to cover the higher excess
Are in a lower-risk area
Have a solid claims-free history
Skip the Unnecessary Add-ons
Avoid specialised "tech insurance" add-ons for items that won't financially cripple you to replace
Consider if the premium increase for specific items exceeds their replacement value over time
Self-insure smaller items and focus coverage on truly catastrophic risks
Break the Auto-Renewal Cycle
Set a calendar reminder 4-6 weeks before renewal
Shop around for at least 3-5 quotes
Call your current insurer and ask for their best rate
Consider bundling policies for additional discounts
Be prepared to switch – loyalty rarely pays in insurance
Recent Concerning Practices
I've been troubled by reports of some insurers withdrawing coverage just before the cyclone hit, particularly affecting hobby farmers. If you experience similar tactics:
Document all communications with your insurer
File a complaint with the Australian Financial Complaints Authority (AFCA)
Contact the Insurance Council of Australia
Consider seeking specialised legal advice
Final Thoughts
Insurance isn't just a legal requirement—it's financial protection for your family's future. The time to review your coverage isn't after disaster strikes, but now, when you can make clear-headed decisions about your needs.
Stay safe and financially secure,
The Wealth Hive
