Flood damage bill could top $2 billion as Treasurer pledges financial support

The damage bill of severe floods impacting Australia's east coast could top $2 billion as the federal Treasurer promises "no effort is being spared" to support victims financially.

S&P Global Ratings broadly predicted the floods would result in $1 billion to $2 billion worth of insurance losses, with the real cost of all goods – insured or otherwise – likely to be much higher.

The rating agency said insurance costs could approach that of the 2011 Brisbane floods, making the current event among the most expensive on record.

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Treasurer Josh Frydenberg told Today "tens of millions" worth of disaster payments had already been made to flood victims and the major banks have already offered three-month repayment deferrals for affected residents.

"I was just speaking to one of my colleagues yesterday, Julian Simmonds, Member for Ryan, he was telling me about one of his local members, constituents, who rang up, their house had been flooded," Mr Frydenberg said.

"They went on to Services Australia, applied for that disaster recovery payment and within the day it was in their account and that money is being used as part of their repair job so the money is flowing and it will continue to flow even more so over coming days and weeks."

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Mr Frydenberg said more than 145,000 claims have been made for the support, officially named the Australian Government Disaster Recovery Payment, a $1000 lump sum per adult to help affected residents.

"We've also triggered the disaster recovery allowance, which is payments up to 13 weeks in duration which is helping people who can't get to work," Mr Frydenberg said.

"Every time there's been a natural disaster, whether it's fires, whether it's cyclones or whether it's been previous floods we have been there as a Federal Government and that includes logistical assistance with the hard-working members of the Australian Defence Force."

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Yesterday, the Insurance Council of Australia reported insurers had received 48,220 claims related to the floods, a 53 per cent increase on yesterday's claims count.

"Following the 2011 Brisbane floods insurance policies now have a standard flood definition," Andrew Hall, CEO of the Insurance Council of Australia, said.

"If a policyholder has opted out of flood (cover), they are most likely still covered for storm damage and if they are unsure they should speak with their insurer."

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Mr Hall said more needed to be done to reduce the cost of insurance for Australians who live in flood-prone regions.

"Insurance prices risk, and that means that for those in flood-prone locations, particularly small businesses, flood cover can be costly," Mr Hall said.

"That is why the ICA has called on all Australian governments to do more to protect homes, businesses, and communities from the impacts of extreme weather.

"With appropriate mitigation infrastructure and household-level programs, property can be better protected and premiums can decrease, but this can only be achieved if governments act with urgency."

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