When Michele Vanderlanh Smith discovered her annual home and contents insurance premium had jumped by 600 per cent, she thought it must have been a mistake.

In just 12 months, Westpac's insurance arm, underwritten by Allianz, had lifted her premium from $728.16 to $5,345.88.


Living on the first floor of an inner-city Sydney apartment block, not prone to flooding, she said she couldn't believe the explanation her contents insurer gave.

"The [contents] insurer basically justified the $5,000 increase by saying that my property's a flood risk," she told ABC News.

"And, based on their national modelling and commercially sensitive information, et cetera, I wasn't entitled to have access to that data."


In contrast, the cost of her building's strata insurance had barely moved.

Westpac's insurance arm also argued she had "consented" to the new premium because her payments were set to automatically debit.

When Ms Vanderlanh Smith said she had only set up automatic payments while working overseas because she could not access her mail during this time, the insurer would not budge.

Instead, she was told she would need to obtain a hydrologist's report at her own expense, if she wanted to challenge the premium increase.

'A black box' for consumers​

Julia Davis from the Financial Rights Legal Centre said households are facing steep hikes with little or no explanation.

"It's impossible for consumers to know if they're being charged a fair price," she said.

"If your premium doubles from one year to the next, it's really hard to understand whether or not you are paying a fair price."

The centre's Insurance Law Service takes 100–150 calls a week, often from people reporting premium increases of 30–50 per cent.

Some callers, like Ms Vanderlanh Smith, have faced rises of several hundred per cent.


"Insurers say they're not price gouging," Ms Davis said.

"But again, they don't share any tailored information with their customers about individual risk on people's homes."

She said the law centre sees examples every day of "insurers simply not meeting community expectations".

"We're still getting calls from people whose claims haven't been appropriately handled in the 2022 floods.

"Now people from Cyclone Alfred are experiencing significant delays, or their vulnerability hasn't been identified. This is commonplace."

Profits surge at major insurers​

The frustration comes as Australia's biggest insurers post bumper profits, fuelled by years of premium increases and a relatively quiet year for natural disasters.

The ACCC's latest monitoring report found the government's cyclone reinsurance pool has moderated price rises in cyclone-prone areas, but across much of the country premiums remain high and continue to climb.

Craig Bennett, director at S&P Global Ratings, said ASX-listed insurers including Suncorp, QBE and IAG were enjoying "very, very solid results".

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