The average claim from water damage received by Chubb in Australia has increased from A$17,627 in 2014 to A$30,361 in 2018.
A new report published today by Chubb Insurance reveals a substantial increase in the number and size of property-related claims by Australian homeowners due to internal water damage. Chubb estimates that the average claim from water damage in Australia has increased by 72% in the past five years.
According to the Chubb Insight Report, Get Smart about Water Leaks, the average claim from water damage received by Chubb in Australia has increased from A$17,627 in 2014 to A$30,361 in 2018.
In addition, water damage as a percentage of actual household claims is also increasing with 34% of all Chubb claims being due to water damage, compared to 16% for fire and 9% for burglary.
“Australians are increasingly more aware of the damage caused by floods and fire, yet few are prepared for the threat from water damage to their homes,” explains Michelle O’Dowd, Underwriting Manager, Australia & New Zealand, Personal Lines, Chubb.
O’Dowd says that while Australian homeowners commonly focus on protecting their homes against fire and theft through locking devices, alarms systems and smoke detectors, there is far less focus on protecting homes from water damage.
“In the US, where we have been tracking water damage claims for many years, it was revealed in a recent survey that only 19% of homeowners recognise internal water damage as the main threat to their homes and only 1.5% of Chubb insured residences have installed water shut-off devices. The figure for shut-off devices is likely to be even lower in Australia although every home is required by law to have a smoke detector fitted.”
While all Australian homeowners may experience water leaks, Chubb’s also research reveals that those living in Western Australia and Victoria are particularly susceptible. In fact, homeowners in these states are 20% more likely to make a water damage claim under their Chubb Masterpiece policy than any other homeowner.
Chubb continues to investigate the reasons for higher levels of water damage in some states but it seems to be due to a combination of factors including building methods, climate differences and even the number of wet areas in the average home in each state.
O’Dowd added that there were two other interesting aspects that Chubb identified when examining claims data for the report: water damage often occurs when a house is unattended, and high value homes are more susceptible to water damage due to multiple bathrooms, kitchens, laundries and appliances which may cause the water damage.
The increasing number of claims and rising cost of these is likely to continue as modern living requires more plumbed-in appliances using flexi hoses, more bathrooms and laundries on upper levels of homes and more open-plan living spaces.
Chubb estimates that only 22% of homeowners in the US shut off their water main before going on holidays and O’Dowd believes this figure is likely to be a lot lower in Australia. “Protecting your home against water damage is as simple as installing one central system to monitor the flow of water across your home or turning off the main water supply at the shut off valve – especially if you’re away for a week or more,” says O’Dowd.
Download the report via www.chubb.com/au-water-leaks
Chubb is the world's largest publicly traded property and casualty insurance company. With operations in 54 countries, Chubb provides commercial and personal property and casualty insurance, personal accident and supplemental health insurance, reinsurance and life insurance to a diverse group of clients. As an underwriting company, we assess, assume and manage risk with insight and discipline. We service and pay our claims fairly and promptly. The company is also defined by its extensive product and service offerings, broad distribution capabilities, exceptional financial strength and local operations globally.
Parent company Chubb Limited is listed on the New York Stock Exchange (NYSE: CB) and is a component of the S&P 500 index. Chubb maintains executive offices in Zurich, New York, London, Paris and other locations, and employs more than 30,000 people worldwide.
Chubb, via acquisitions by its predecessor companies, has been present in Australia for 100 years. Its operation in Australia (Chubb Insurance Australia Limited) provides specialised and customised coverages, including Business Package, Marine, Property, Liability, Energy, Professional Indemnity, Directors & Officers, Financial Lines, Utilities, as well as Accident & Health insurance, to a broad client base, including many of the country’s largest companies. Chubb also serves successful individuals with substantial assets to protect and individuals purchasing travel and personal accident insurance. With five branches and more than 800 staff in Australia, it has a wealth of local expertise backed by its global reach and breadth of resources.
More information can be found at www.chubb.com/au