Shock' over $16,000 home insurance price hike

A Queensland mother said she can't believe her household insurance has gone from just over $1600 a year to more than $16,000 when she's never even made a claim.

Single mum Emma Lawson, who lives in Maryborough, said she felt sick after receiving a renewal notice from Allianz. Her insurance rose from $1699 a year to $16,418.

"How did they work this out? … it's broken down that the flood premium is $12,000 alone," Lawson told A Current Affair.

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Allianz say the reason for the price hike is the devastating January floods which swamped much of Maryborough.

"I understand that they've paid out in the last 12 months for what's happened in Queensland and northern New South Wales. But, all the years before they were taking our money and they weren't worried about it, then," Lawson said.

Lawson built her new home in 2021.

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She lives above the last flood level and her home has never been flooded.

"I've never made a claim on any insurance policy," she said.

"No properties in this area were impacted by the water."

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Lawson said she believes they may have increased the price because they don't want to insure her.

"They really should have just said, 'we can't insure you'," she said.

After speaking to Allianz, Lawson said she was told she could remove the flood premium and substantially reduce the cost.

But even though she's never been flooded Lawson wants to keep the flood insurance so she started to shop around.

"Living on the river I am realistic that there is a chance, I think it's very unlikely but I wouldn't be able to do it again if I lost it," she said.

A financial comparison expert said it was crucial to insure your house but was surprised at how much the premium rose by.

"I'm shocked to see a premium going up tenfold in one hit," Steve Mickenbecker from Canstar, said.

"But if you're in an area that is flood prone and in particular a house that has flooded, expect it to go up a very big amount.

"Insurance is critical. You don't need to insure every little thing but you do need to insure your house," Mickenbecker said.

"You lose your house to massive fire, big flood, then frankly you are in a lot of trouble financially."

Lawson said other insurers were offering home insurance with flood cover for around $5000.

In a statement a spokesperson for Allianz said: "(It) acknowledges that the cost of flood cover can be expensive for flood risk properties".

The statement added that government flood maps, data and flood risk modelling 'in some areas indicated a much higher flood risk than previously'.

Allianz denied abandoning homeowners in Maryborough.

What does it mean for other Aussies?

"People even looking at a doubling of the premium, in some cases will look at it and say gee, I just can't afford this," Mickenbecker said.

"Once you have compared all the policies that have cover, maybe there are bits of cover to live without, but don't live without the really big things."

Lawson said she will allow her insurance policy to lapse when it ends in August and then will go with another provider.

She said her insurance policy went from the cheapest available a year ago to the most expensive.

"I spoke with the neighbours and shopped around and found out that there was going to be another provider that I could afford," she said.