Car Insurance, flood damage

Flood damage

We’ve all seen the dramatic video footage of many parts of Australia under metres of flood waters.

Cyclones, tropical lows and other weather variances have been responsible for everything from dumping deluges to flash flooding across areas that have been bone dry for at least a decade. Some say La Niña and global warming mean that this type of weather could be here to stay, which means we need to be prepared for future flooding that leaves a huge amount of damage in its soggy wake including to our cars.

Car flooded?

No, we’re not talking about giving the engine too much choke. We’re talking about the more serious casualties of flooding rains and huge seas: cars swept off causeways, flooded bridges, vehicles engulfed as giant waves crash over sea walls. If your car was last seen swirling down a flooded river or languishing at home in a water-logged garage, what do you do next?  Unfortunately, if your car is not insured there is very little you can do to recover the cost of your vehicle. If your car is insured, however, you need to know exactly what your policy covers and what, if any, costs are incurred.

Who’s at fault?

More often than not, it comes down to the individual circumstance. For example, an optimistic motorist takes on a flooded causeway, only to discover that Mother Nature’s four-wheel drive mechanism is a heck of a lot stronger. Compare this scenario with a motorist simply caught off guard by flash flooding and you will see that there are any number of reasons a claim can be lodged for flood damage to a vehicle. Luckily for motorists, insurers cover a wide range of flood-related damages claims but whether the incident is treated as an “at fault” claim varies between insurers. This may or may not affect the status of your driver rating so it is worth checking out.

Related stories

Make sure you’re not out of pocket

Examine the fine print on your car insurance policy to see whether there are any circumstances where your policy won’t cover you. For the most part, provided  the damage or loss to your car was not intentional or fraudulent, you will be covered with any flood or water damage claim you make. This is not to say you should feel confident crossing swollen rivers in your sportscar but you can rest assured that, should the worst happen, it’s unlikely you will be hung out to dry by your car insurer.

What to do if your claim is rejected

If you’re at all concerned about your claim being rejected, gather as much evidence about the claim as you can, such as photos, eyewitness accounts, information about the peak time of the flood waters and time of your journey. This helps you mount your case to the insurance company. If your claim is rejected but you wish to have the matter taken further you must first request an internal review of the claim from your insurer. If, after this review, the claim is still rejected you can have it reviewed for free by the Insurance Ombudsman Service (IOS). This is an independent body which has the power to make binding decisions by which the insurer must abide. You can contact the ombudsman online at

Related Links

Did you find this helpful? Why not share this article?



Money Health Newsletter

Subscribe for news, tips and expert opinions to help you make smarter financial decisions

By signing up, you agree to the Privacy & Cookies Policy and Terms of Use, Disclaimer & Privacy Policy


Learn more about car insurance

Can you insure your car for 6 months?

Most Australian insurers won’t offer you a 6-month car insurance policy, so you may need to buy a policy that covers your car for damages and cancel it after six months. You will need to purchase comprehensive car insurance to protect your car from accidental damage, theft, vandalism, or natural disasters.. 

Consider checking whether your 6-month comprehensive car insurance will cost more if you pay monthly or six-monthly premiums instead of a one-time annual premium. Another question to ask the insurer is whether you’ll need to pay administration or cancellation fees when you cancel the policy.

Alternatively, you can look for a suitable ‘pay as you drive’ car insurance policy, which usually offers you the coverage of a comprehensive car insurance policy but only requires you to pay for the distance driven. Such a policy may not be the ideal 6-month car insurance plan as it is based on how much you drive rather than for how long. If you need to drive a lot, you may end up paying more than you’d pay for regular car insurance. 

Does insurance cover a stolen car if keys were in the car?

A car insurance policy that covers the theft of your car, such as third party fire and theft insurance, usually covers a stolen car, even if the keys were in the car’s ignition.

However, your insurer may deny the claim if you live in an area where there have been several car robberies reported recently. They will see you leaving the keys in the car as a case of negligence. In such cases, your insurance provider may even expect you to have installed anti-theft security measures in your car. 

You may need to confirm whether or not you left your keys in your car, and if they had been stolen or misplaced, before filing your car insurance claim. The loss or theft of your car keys may be covered by a comprehensive car insurance policy, but usually as an optional item.

If you can confirm that your car keys were stolen, mention this in your claim as this will help establish that your car was not stolen as a result of your negligence.