The water came through the back door, ruined the floors, the kitchen, half your contents. You called your insurer expecting a straightforward claim. Instead you got: “I’m sorry, that was flood, not stormwater, and your policy excludes flood.” Or the reverse — your premium included flood cover, but now they say it was actually storm runoff and a different exclusion applies. Either way, you’re stuck.
The “is it flood or storm?” argument is the single most common dispute in Australian home insurance, especially after the 2022 east-coast events. The good news: there’s a legally mandated, standard definition that often works against the insurer.
The legal framework
Since 2012, the Insurance Contracts Regulations 2017 have imposed a standard definition of “flood” across all Australian home insurance: “the covering of normally dry land by water that has escaped or been released from the normal confines of a watercourse, lake, reservoir, canal, or dam.” If the water that damaged your home came from rain hitting your roof, blocked gutters, overflowing drains, or storm runoff that didn’t escape from a watercourse — it’s not flood, it’s storm or rainwater, and a flood exclusion can’t apply. The Insurance Contracts Act 1984 and the General Insurance Code of Practice provide the wider duty-of-good-faith and dispute frameworks.
Common refusal reasons and why they often fail
- “It was flood, you’re not covered.” Was the water from a watercourse? If the source was rainwater pooling, it’s not flood under the standard definition.
- “It was storm runoff, your storm cover excludes runoff.” Many policies cover rainwater entering through a damaged building element — check carefully.
- “Multiple causes, we can’t tell what’s covered.” Insurer must apportion. They cannot blanket-deny because some damage might be excluded.
- “You didn’t take reasonable steps.” Section 54 of the ICA limits this defence sharply.
- Hydrology report saying it was flood. You’re entitled to a copy. Independent hydrology reports often disagree.
Ready to put it in writing?
Answer 3 quick questions to check you have the details your document needs, and see your next step.
1. Who is this about?
2. How much is at stake?
3. Do you have it in writing?
Your result is ready. Where should we send it?
What the document does
The Letter of Demand quotes the standard flood definition, the policy section the insurer is relying on, the factual narrative of where the water came from, the dollar amount, and a deadline (usually 21 days). It also requests a copy of any hydrology or assessor report under the Code of Practice. This single request often shifts the case.
What Claim Done delivers
The Claim Done wizard takes your policy, the assessor’s letter, and your photographs, and our Programmatic Algorithms draft a formal complaint to the insurer and an AFCA complaint citing the standard flood definition, the right ICA sections, and the Code clauses on report disclosure. Flat $97 fee, draft ready in about five minutes for you to read and approve.
What to expect after sending
Common outcomes: a revised assessment with a partial or full settlement, or a request for a joint expert. If denied again, lodge an AFCA complaint — free for you, and its decisions can bind the insurer.
What happens when you put it in writing — properly
Same problem. What a prepared case looks like.