Cyclone Alfred: Is it too late to get home insurance?

With Cyclone Alfred brewing off the Queensland coast, it's a chaotic reminder that natural disasters are, unfortunately, a thing.

While Queenslanders might be scrambling, it's probably too late to update their insurance now. It sucks, but the cyclone is absolutely going to be excluded for new and updated policies.

Why it's too late to get insurance once a cyclone starts

It might seem unfair that you can't buy insurance when you know you need it. However, there are some fairly good reasons why insurers won't let you get a new policy or update an existing one once a cyclone (or other natural disaster) is imminent:

• Preventing exploitation: Insurance is about protecting against unforeseen events, not providing a guaranteed payout for something that's already happening. This would be a bit like betting on a horse race after it's already started and you can see the frontrunner.
• Risk assessment: Insurers carefully assess risk before they provide coverage. When a cyclone is brewing, the risk profile of a property changes dramatically. It's much harder for them to accurately assess the potential damage and determine a fair premium during this time.
• Protecting the insurer (and other policyholders): Allowing people to buy insurance at the last minute would put a huge financial strain on insurance companies. They need to manage their overall risk to ensure they can pay out legitimate claims to all their policyholders, not just those who jumped on board right before a disaster.
• Fairness to existing customers: People who have been paying premiums consistently shouldn't be disadvantaged by those who only try to get coverage when disaster strikes.

For those of us not in the path of Cyclone Alfred, it's a good reminder to get our own home insurance sorted before something like this happens.

Why bother checking your insurance?

Let's be real, nobody wants to think about floods, fires, or cyclones ruining their stuff. But these things happen, and they can be a major financial hit if you're not prepared.

If you don't have home and/or contents insurance already, then it's hopefully a no brainer why you should at least consider it. If you can't afford to replace your home, or all your stuff, if something were to happen, then a policy is probably a good idea to consider.

Even if you have a policy, your situations will change over time, and your policy should change with it. A few changes might include:

• Your home value: If your home has gone up in value, your policy should be updated too. Otherwise you risk being underinsured, which can be a major problem.
• Climate risk: Your home's climate risk will change over time, as insurers update their profiles. Learn from Queenslanders this week and make sure your policy covers everything that might go wrong.
• Life changes: Whether it's having a kid, buying more stuff, or getting a new job, changes in your lifestyle can drastically affect what you need insurance cover for.

Updating your existing cover only takes a short call to your insurance company. Of course, you can also try and save some money by comparing home and content insurance from multiple providers.

What to look for in your policy:

If you're updating your home and content insurance, in preparation for a climate emergency or otherwise, here are a few things to know about it, and what to look for.

• Building Insurance: This covers the cost of fixing or rebuilding your actual house if it gets damaged. You probably won't need this if you're renting, or living in a strata building like an apartment.
• Contents Insurance: This covers all your stuff inside the house, like furniture, tech, clothes - you name it. This is useful for everyone, including renters and apartment dwellers.
• Flood Cover: If you live anywhere near a river or the coast, you'll want to make sure you're covered for floods - they're not always included in basic policies.
• Bushfire Cover: Super important if you live in a bushfire-prone area (you know who you are).
• Emergency Accommodation: This helps pay for a place to stay if your home is unlivable after a disaster.
• Liability Coverage: This protects you if someone gets injured at your place.

Don't be that person

While Queenslanders are frantically prepping for Cyclone Alfred, many are doing so without the financial protection that home insurance offers, and now they can't do anything about it.

You can't stop a cyclone, but you can get that peace of mind, if you take a moment to check your own insurance situation now. Don't wait for a disaster to hit before you realise you're not covered.