Cash settlements on home insurance claims leaving vulnerable Australians short-changed, Asic says
The Australian corporate regulator, ASIC, has warned that insurers are increasingly using cash settlements instead of managing repairs for cyclone-damaged homes. This practice often leaves homeowners under-compensated and struggling to manage repair costs and trade coordination.
Why it matters
It highlights a systemic issue in the insurance industry where cost-cutting measures by providers shift financial and operational burdens onto vulnerable disaster victims.
Asic reviewed a sample of home building insurance claims from Cyclone Jasper, which hit far north Queensland in December 2023. Photograph: Brian Cassey/AAP Asic reviewed a sample of home building insurance claims from Cyclone Jasper, which hit far north Queensland in December 2023. Photograph: Brian Cassey/AAP Insurance (Australia) Cash settlements on home insurance claims leaving vulnerable Australians short-changed, Asic says Corporate regulator finds insurers settling most claims with cash rather than by managing repairs or rebuilding, warning of ‘unfair outcomes’ for homeowners
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Prefer the Guardian on Google Home insurers are overwhelmingly paying cash to settle claims, leaving Australians to foot blowouts in repair costs for their cyclone-damaged homes.
The corporate regulator is calling for “realistic” bigger payouts, warning the practice could cause “unfair outcomes” for people already in vulnerable positions.
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