10 March, 2022
Flood victims beware of insurance claim farmers
FLOOD affected Queenslanders are warned to be aware of ‘claims farmers’ who often crop up in the wake of disasters to offer assistance with their insurance claim.
Attorney-General and Minister for Justice, Shannon Fentiman, said these firms are sometimes known as ‘claims management services’, and act as a go-between for a person or business and their insurance company, offering to do the leg work on their insurance claim for a fee.
Ms Fentiman said it’s important for Queenslanders to know they don’t need a third party to assist with an insurance claim and they can deal directly with their insurer.
There are numerous risks when dealing with a claims farmer. For example, the firm usually seeks a cash settlement as the resolution.
This could mean you lose the option for your insurer to arrange the repairs which can be a complicated process.
It could also mean you may be left out of pocket in situations where the repair costs are uncertain, and you may have to pay the firm directly if your insurance company does not pay the claim.
The firm may also inflate your claim unreasonably to increase their own fee.
If you have problems with the firm, you need to engage a lawyer and possibly go to court to resolve it.
Ms Fentiman said anyone concerned about the conduct of a claims management service or claims farmer should conduct the Australian Securities and Investment Commission (ASIC).