Cyclone Preparedness — Reviewing Your Insurance Before Storm Season

For homeowners and businesses in northern Australia, cyclone season is a regular reality. The period between November and April brings the highest risk for Queensland, the Northern Territory and Western Australia — and the time to review your insurance is well before a system forms, not after a watch or warning is issued.

Once a cyclone warning is active, insurers often impose embargo periods on new policies and changes to existing cover. If you haven’t reviewed your policy before the season starts, you may find yourself locked out of improvements until conditions pass.

What cyclone damage is typically covered

Most home building and contents policies and commercial property policies cover cyclone as a defined peril — but the detail matters. Cover generally extends to:

• Physical damage to the building caused by wind, including roof loss, structural damage and fallen trees
• Contents damage resulting directly from the cyclone event
• Water ingress caused by the cyclone damaging the building (a distinction that matters — see below)
• Temporary accommodation costs while the property is uninhabitable, subject to policy terms
• Removal of debris where included in the policy schedule

For businesses, business interruption cover may respond if the cyclone forces trading to cease or be substantially reduced — but only if the trigger conditions in the policy are met, which typically requires physical damage to your own property first.

The flood vs storm surge vs wind-driven rain distinction

This is where claims become complicated. Many policies treat cyclone wind damage differently from flood damage, even if both occur in the same event.

• Wind damage — generally covered under cyclone peril
• Rainwater entering through a damaged roof or wall — generally covered as a consequence of the wind damage
• Storm surge — seawater inundation caused by the low pressure system pushing the ocean inland. This is often excluded from standard policies or subject to specific sublimits. Coastal properties need to check this carefully.
• Riverine flood — flooding caused by rivers or waterways breaking their banks after heavy cyclone rainfall. This requires specific flood cover, which is a separate defined event in most policies.

The distinction between these water types can determine whether a claim is accepted or declined. If your property is near the coast or a waterway, read the flood and storm surge definitions in your policy wording closely — or ask your broker to explain where your cover starts and stops.

Sums insured and underinsurance

Cyclone claims have a way of revealing underinsurance that was invisible until the loss occurred. Building replacement costs have risen substantially in recent years — labour, materials and freight are all higher than they were when many policies were last properly valued.

A useful starting point is to consider:

• Has the building been improved, extended or had major works done since the policy was set?
• Does the sum insured reflect current rebuild costs, including demolition, debris removal and professional fees?
• For contents, does the sum reflect what it would actually cost to replace items at today’s prices?
• Are any high-value items (machinery, equipment, vehicles) separately scheduled and valued?

Underinsurance means the insurer may only pay a proportional share of the claim — sometimes called the averaging or co-insurance clause. This can result in a significantly reduced payout even for a legitimate claim.

Actions to take before cyclone season

• Review your policy schedule and check that your sums insured are current
• Read the flood, storm surge and cyclone definitions and understand what is and isn’t covered
• Check whether your business interruption cover requires physical damage and what the indemnity period is
• If you’re in a high-risk coastal zone, ask your broker specifically about storm surge exclusions
• Confirm your claims notification process — have your policy number and broker contact details accessible offline
• Photograph or video your property and contents as a record of their condition before the season begins

During and after a cyclone event

If your property is damaged, notify your insurer or broker as soon as it is safe to do so. Take photographs of all damage before temporary repairs are made — temporary protection is generally required to prevent further loss, and reasonable costs are usually claimable, but document everything.

If you need temporary accommodation, keep receipts. If you’re a business experiencing interruption, maintain records of your trading position so the loss can be calculated.

If you’d like to review your property or business insurance before storm season, contact WebInsure. We can help you understand your current policy and identify any gaps that are worth addressing before conditions develop.

This post provides general information only and does not constitute personal advice. Cover availability, terms, exclusions and premiums vary by insurer, product and individual circumstance. Always review the Product Disclosure Statement and confirm suitability before making a decision.

WebInsure Pty Ltd ABN 32 054 247 666 is an Authorised Representative 000271148 of Community Broker Network Pty Ltd ABN 60 096 916 184 AFSL 233750.