QLD Insurance on Flood affected properties

Hi

I use Wespac Insurance for my QLD IPs as they have good flood coverage even though the IPs are not actually in flood affected areas.

I found a couple of properties in another area that were inundated by water during the 1974 & 2011 floods and called up Wespac for a quote for the building & landlord insurance but surprisingly the cost are the same ??? I found this very strange. Aren't the premiums higher for flood affected properties ?

I've recently submitted an offer on a property in an area not affected by flood but situated near a creek used for drainage which has water overlay 90m from the property I'm buying so am abit nervous about this due to fear of potential water issue/flood. So I checked out insurance cost, turns out similar to the above properties. I've also asked for quotes on an address situated closest to the overlay and of another several streets away far from the overlay (using same age/build type on all properties etc to keep the parameters constant) and surprisingly the insurance of the house directly opposite the overlay is a few dollars cheaper than the one high & dry ... far away from the water overlay!!!! How could this be ???

Am I worrying too much about water issue with this purchase ??? Council says the creek is 26.5m above sea level, property I'm buying is 27 to 28m above sea level. Also something about it would flood at 20m and my property 8m above that ....

 

Risk is aggregated by postcode, not individual property. So within the postcode, it doesn't matter how high or low your particular property is - the premium's calculated on the average risk of properties in the postcode.

 

Can we find out which areas are higher risk?

 

Only by getting loads of quotes! It's not even uniform across companies. Postcodes that are more expensive with insurer A, can be less expensive with insurer B.

 

Hi Perp,

This is true, I have done this on stacks of addresses the Wespac operator thinks I weird I found insurance quotes for properties in Cairns very expensive!!! 2 or 3 times the cost!!! They say its due to the high risk weather up there. So would think that properties elsewhere down south in Brisbane that have been inundated in 1974 and 2011 would be just as expensive but they're not!!!

What other research can one do to ensure the property they purchase is safe from water/flood issues ?
Is being close to water overlay (in a area not affected by flood) considered high risk ?

 

Yes, use the flood maps, which for Brisbane can be found at http://www.brisbane.qld.gov.au/plan...-tools/online-tools/floodwise-property-report

As a backup, if you're interested in a particular property, talk to the neighbours and ask where the water came to in 2011, and see if that matches the flood map.

I don't think it's worth placing too much weight on what happened in 1974, given the huge changes in overland flows that have happened since. (As evidenced by the 2011 floods being worse than 1974 in some places, though mostly less severe.) Also, you have 2011 data to work with, which is much more relevant.

 

It is possible to get that over-ruled
Suncorp concedes defeat after flood maps clear Rocky home
http://www.themorningbulletin.com.au/news/suncorp-concedes-defeat/2695701/

 

Possible, yes, but I note that the article doesn't, in fact, include what the outcome was. Also, that it only allows individual review for "astronomical" increases.

Excuse me if my cynicism looks big; I've spent most of the past 5 years fighting insurers on flood claims.

 

Hi Perp - Note that the interactive maps show properties flooded even though for some areas agents say there has never been a flood...e.g. somewhere called "Hope Island"? which the council marked the whole area as flooded and it's note.

Any reasons for this?

Further, it will put off many buyers in the future if the current buyers are skeptical..

 

The flood map shows areas that will be flooded in the instance of a 1-in-however-many-years event based on modelling. There hasn't ever been one of those events since Hope Island was developed - it's quite a new development - but that doesn't mean it won't ever be flooded.

e.g. If it shows where a 1-in-100-year flood would reach, based on modelling, but the development's only been around for 20 years, there probably hasn't been a 1-in-100-year flood during that time.

 

Hi Perp, does 1-in-100-year flood mean a major flood to occur once every 100 years ? I once asked council this question they explain to me as the chance of a flood occuring once every year, continuously for 100 years!!! This sound very strange to me but I'm not from from QLD so unsure of how often do flood affected areas or their affected parts actually get flooded ?

I've looked at a few sold properties that were completely inundated in 2011 but are now fully fixed/repaired and look as new and the sold prices are not too far off from those from unaffected parts of the area. Is it because people familiar with the area are not fearful of the flood recurring as it is quite unlikely ???

 

It means that taking into account the size of the catchment and the rainfall averages and distribution etc., once every 100 years, on average, you'd expect the area in that zone to be covered with water. It might happen twice in a decade, if you're really unlucky, or it might not happen for 200 years, but if you averaged data over a thousand years, that location would be flooded around 10 times in that period.

Areas that are lower than that line you'd expect to flood more often.

 

i see, thanks for the explanation Perp So in that case, given there was a major flood in 1974, 2011 and 2013 is it safe to assume that it won't happen again until a very long time, i.e several decades or even 100 years time ?

 

Ha! Well, you could... We bought our place in 2000, which was *just* in a 1-in-100-year flood zone, and had only been flooded in 1974. But nearly all Brisbane was flooded in 1974! So we weren't too worried.

Got flooded in 2009, and again in 2011, then got a letter from Council saying "based on new data...", oops, sorry, you're actually in a 1-in-5-year flood zone.

I think that the flood map revisions made in 2011 are pretty conservative compared to earlier maps. So if you're still "only" 1-in-100-year flood zone based on the 2011 mapping (rather than 1-in-lower-number-of-years), that's reasonably safe. But don't hold me to it and come back to me if it floods next year - freak things happen!

 

oh i see... i use the local council flood map. They have parts affected by the 2011 and 1974 floods highlighted but there was no mention of 1-in-lower-number-of-years. Yikes I didn't know these exist !!!! they're probably more risky given the high frequency ? Where can we find these info ?

Would a home located on the high side of the street, say about 1m above street level be safe from flood, if the street itself is not flood affected but some parts of the area are (due to nearby creeks) ?

 

Those flood maps sound like actual maps, rather than projections based on modelling (which is what you really need). For Brisbane, you find the modelling info with a Floodwise report.

 

Oh thank you Perp!!!! This is awesome info. I've plugged in my target address but it didn't come up. Is this just for Brisbane city council alone, or does it cover Logan, Redland bay, Ipswich and Moretone as well ?

 

You're welcome, pleasure.

That one is only for Brisbane City Council, but I imagine the other councils have similar. Go to the relevant council's website and search for "flood report" or something like that.

 

No not at all the probability is the probability.
Just because it happened yesterday doesn't mean it couldn't happen tomorrow. The odds haven't changed.

 

That's wrong . We have had quotes from just over 1 k to 6 k for properties in the same suburb .

One property we bought was about 200 more because the block next door was flood prone . The person on the phone could see that it was raised about 20 meter above the block next door ( that didn't matter ) , but did give us a discount as our property was on stumps ...

Now , we get quotes on anything that's remotely close to a flood zone ( prior to making offer ) and SWMBO really doesn't want anything too close , in case the insurance companies decide to change how they look at things in the future .

Cliff