Victoria's September 2021 earthquake generated the third-highest number of insurance complaints in the last 12 months after COVID-19 and the flooding in south-east Queensland and New South Wales, according to the Australian Financial Complaints Authority (AFCA).
As of June 22, AFCA had received more than 350 complaints related to the 5.9 magnitude Mansfield earthquake.
This compares to more than 3,700 complaints about COVID and nearly 400 flooding claims.
Financial Rights Legal Service acting director of casework Jane Foley believes the true number of people unhappy with the outcome of their earthquake insurance claim could be much higher.
"People get frustrated by the claims process," Ms Foley said.
Millions of dollars of damage caused
Overall there have been more than 16,000 insurance claims related to the earthquake, valued at approximately $120 million, according to the Insurance Council of Australia.
AFCA said most complaints related to home building insurance, with about 60 per cent due to a claim being denied because of a policy exclusion or condition.
Other complaints were due to delays, denial of claims for other reasons or disputes over the claim amount.
"The insurer might consider that it's not earthquake damage, but is due to other factors – for example, the damage is pre-existing damage, or the property is too far from the epicentre of the earthquake for it to be the cause," AFCA's lead ombudsman for insurance Emma Curtis said.
The complaints authority has already closed more than 120 complaints, resulting in insurers paying customers close to $300,000.
AFCA says policyholders who disagree with the outcome of an insurance claim should make a complaint to their insurer.
If the problem is not resolved within 30 days or a complainant disagrees with the outcome, they can then register the complaint with AFCA.
Cause of damage hard to prove
The Financial Rights Legal Centre said they had received a high volume of calls about the Victorian tremor.
Ms Foley said earthquake claims could be difficult to assess because it was hard to pin down when a crack occurred and what caused it.
"The obligation is on the policyholder to prove they have experienced loss caused by an insured event," she said.
"That's why I would usually recommend getting your own evidence, so you need an expert.
For more information about your rights, Ms Foley recommends looking at their earthquake claims guide or the general insurance code of practice.
