Insurance ‘fine print’ slashes payout hopes
AN INSURANCE broker had agreed limits to the level of payouts for losses from flood in insurance packages could be more prominently displayed.
The admission comes as the owner of the Priceline Pharmacy at Fairfield Central Shopping Centre has discovered she is eligible only for up to 20 per cent of her insured amount after sustaining losses "well into the six figures".
The case of pharmacy owner Christine Richardson is different from many other affected businesses who had insurance policies which did not include cover for flood.
Ms Richardson elected to take out flood cover as an extra option.
But she did not realise the 20 per cent limit.
Ms Richardson was shocked when she read the "fine print".
"When I saw it as an optional extra that I had chosen, when it says flood optional extra cover, you assume you are covered," Ms Richardson said.
"It's time for policies to be reviewed. We need to throw out the old rules and get some unprecedented action, unprecedented support from government and from insurers."
Her insurer ProRisk did not respond to inquiries yesterday but executive chairman of broker Insurance House Gary Gribbin said the 20 per cent limit was not a "small print matter".
He agreed, however, that it could be more prominently disclosed.
"There's arguments to say it should all be together," Mr Gribbin said.
Even so, Mr Gribbin said flood cover was "terribly difficult" and its cost tended to be prohibitive in areas with a flood risk like Townsville.
"If you are in a clear flood zone, insurers tend not to provide cover at any price."
Meanwhile, Ms Richardson is praying the event is deemed to have been caused by storm rather than flood water to receive a 100 per cent payout.
"This situation means for some people, if they have missed one clause in one document among the minefield of stuff they have to deal with, it can destroy their whole business," she said.