Insurers face bush fire claims

Bushfires have destroyed an estimated 100 homes on the NSW Central Coast and the Blue Mountains, and that figure could go higher with an estimated 34 fires still burning out of control in the state.

Insurers have already started receiving claims, but have warned that more will flood in as people return to their homes. According to the Australian Financial Review (AFR), New South Wales’ largest insurer, NRMA, which is fully owned by Insurance Australia Group (ASX: IAG), holds around 30 to 40% market share of home and contents insurance policies in the affected areas.

NRMA spokesman James Rickards has told the AFR that it was still too early to provide any data regarding potential impacts or the number of claims likely to be received in the coming days. Mr Rickards says the company’s priority is to assist impacted customers by providing immediate help and support to manage their claims as quickly as possible.

It’s not just claims for totally destroyed properties either. Many residents have received superficial damage to their homes and assets, such as heat, smoke and water damage.

The Insurance Council of Australia has declared the bushfire-affected regions a catastrophe, and has setup a taskforce to escalate the industry’s response to the devastation. ICA boss Rob Whelan says the ICA will be liaising with government agencies and emergency services, as well as local and state politicians to assist with enquiries and issues.

NRMA says it has teams of assessors standing by ready to deploy once it is safe to do so. Fellow insurer Suncorp (ASX: SUN), which counts AAMI and GIO among its brands, said it would have assessors on the ground to gauge the extent of the damage, once given the green light by authorities.

Customers affected by the bush fires are being asked to contact their insurers as soon as possible to lodge a claim. Most insurers, including Suncorp, IAG and QBE Insurance (ASX: QBE) have information on steps consumers can take to support their claims.

Foolish takeaway

So far it’s been described as the worst bushfire to hit NSW in more than a decade. With around 100 fires still burning, and 34 still uncontained, residents and insurers will be hoping recent cooler conditions continue for at least the next couple of days.

Not interested in insurers? Discover two stellar small-cap opportunities now, in our brand-new research report, “2 Small Cap Superstars” — simply click here to download your FREE copy.

More reading

Motley Fool writer/analyst Mike King doesn’t own shares in any companies mentioned.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.