Insurance Claims – Water, Flood, and Property

Over the last few weeks Hong Kong has been on the receiving end from a number of significant weather events. With two Typhoons, including Super Typhoon Saola, and an unprecedented rainstorm which dropped more moisture on the city than at any time since records began, it is fair to say that Hong Kong has been battered by the weather recently.

The aftermath of these storms has seen extreme property damage, and the deaths of at least two people. It is likely that there are going to be a number of claims with regards to the insurance coverage on this disaster. In an effort to assist you in navigating the impact of these storms here is information related to various policy types that may have been impacted by the Black Rainstorm on September 7th and 8th 2023.

Car Insurance Claims

The storm brought devastating flash floods to the entirety of Hong Kong. Cars parked on streets were washed into pedestrian guardrails puncturing tires and experiencing body damage, and vehicles parked in underground garages were completely flooded by water. Videos and Images have been circulating on social media of vehicles in many districts swamped by the rising water – for extended periods of time.

Cars even fell into sinkholes on the roads, and were involved in myriad traffic accidents across the city as the weather rolled in.

If your vehicle was damaged because of the rain and resulting floods, here is what you need to know:

Only Comprehensive Coverage Will be Claimable

Only policyholders who possess a valid Comprehensive Car Insurance policy will be able to claim for flood or water damage to their vehicle. This is due to the fact that Third Party Car insurance coverage only protects against the policyholder’s financial liability of being responsible for an accident which causes injury, death, or property damage.

Comprehensive Car Insurance coverage offers a much wider range of protection – and can include coverage for most damage to your vehicle, even when the car is parked.

What You Need to Do

In the event that you hold a Comprehensive Car Insurance policy and your vehicle was damaged by the rainstorms or typhoons, it is important that you contact your Insurance Company as soon as possible to assess the extent of the damage and find a repair shop to fix your vehicle. Take pictures of your vehicle in the state in which it was damaged, and provide these pictures to your insurance company. You will normally have to complete a claim form and submit this to the insurer along with all supporting information you have collected.

Do not start repairs before contacting your insurance company. 

Approval should be given prior to repairing your vehicle in order to receive as much cover towards the restoration possible under the policy. In some cases, a claims adjuster may be sent to physically inspect the location of the claim. Any deductibles, excesses, or betterment clauses on your policy will apply to the claim and repairs made to your vehicle. 

Negligence and Liability from Property Management

In some very rare situations, the damage to your vehicle may have occurred due to negligence or mismanagement by the property owner or management company.

For example; failing to properly clear blocked drains in an underground parking garage may have been the proximate cause for a flood occurring. While the rain was unprecedented, the flood may have been avoided if proper care were taken towards facility maintenance and upkeep.

In this case, it may be possible for the owner of the damaged vehicle to submit a civil claim against the property owner/management. This may be through the responsible entity’s Professional Liability protection, or through a Public Liability Insurance policy. The claim may also be settled through the legal system on a private basis, but this can be a long and drawn-out process.

Property Insurance Water and Flood Claims

Hong Kong has seen a significant amount of property damage over the last 3 weeks. The damage to homes, apartments, and personal possessions has been extreme and extensive.

From reports of storm doors opening in the interior of buildings, causing multi-floor waterfalls and internal flooding, to broken windows, electrical fires started by flooded air-conditioning units, virtually no household in the city has escaped the wrath of the recent storms unscathed.

Property Claims are largely going to be broken into two areas: Home Contents Insurance and Fire and Allied Perils Property Insurance. Both these coverages are going to work in a similar manner, but have a different objective in their protection.

Home Contents Insurance Water and Flood Claims

Under your Hong Kong Home Contents Insurance policy, also known as Renters Insurance in other parts of the world, you will typically receive Worldwide All Risks protection for your personal possessions. This means that if your laptop was submerged under water during the flooding of your apartment, or the AC that you installed (personally) in your bedroom was flooded and rendered inoperable, you may be entitled to compensation from your insurance company.

If your personal belongings were damaged in the storms, you should report the damage to your insurer as soon as possible. You may be asked to complete a claims form, and submit this to the insurance company along with photos and details of the damage. If you have not previously provided original receipts or valuations to the insurer for high value items which are being claimed, these may be requested at this time.

After a review of the documents and the loss situation the insurer will provide compensation in line with the specific policy terms and conditions. It is important to note that any deductibles, excesses, or betterment clauses in place on your policy will apply to the total financial settlement you receive under a successful claim.

Fire and Allied Perils Insurance Flood Claims

If you own your home in Hong Kong the bank will normally have required you to take out a Fire Insurance policy in order to successfully complete your mortgage application. However, there is normally a choice with regards to your purchase of this policy – Fire Insurance or Fire and Allied Perils insurance.

Fire Insurance typically only covers fire. This means loss events where the proximate cause of the claim (the thing that caused the who claim to occur) must be Fire in order for fire insurance to apply. Fire and Allied Perils insurance expands this coverage to include losses from a range of associated risks, or perils. This includes things like water damage or flooding, landslips or subsidence, and even wind.

If you experienced damage to a property that you own during the recent Hong Kong storm events, the first thing to do is assess whether the damage is covered under your policy. Water damage will be excluded from a simple fire insurance policy, so only property owners in possession of a Fire and Allied Perils Insurance plan are going to be able to fully benefit from their coverage in this situation.

Report the damage and claim to your insurer as soon as possible. Provide as many pictures as you can, and offer as much supporting information as you have access to. One you have submitted your claims form, the insurer may elect to send an investigator or claims adjuster to your property to fully assess the extent of the damage.

Receive prior authorization from the insurer before starting any repairs to your property.

As with all other insurance products, Deductibles, Excesses, Betterment, and Replacement terms on your policy will apply to the claim.

Flood and Storm Liability Insurance Concerns

If you or your property were responsible for damaging property belonging to another entity, or causing injury or death to a person as a consequence of the recent weather events to hit Hong Kong it is important that you do not admit any liability.

This could be as simple as saying “I’m sorry that happened” or “I should have brought that plant pot inside.”

Any liability claim resulting from the two recent typhoons or the freak storm on August 7/8^th 2023 may need a full investigation from the insurer and the police – depending on the extent of the damage. Shop owners who’s signage has flown away and broken nearby windows, property owners who didn’t clear their storm drains, and contractors who left scaffolding loosely affixed may all be financially liable for the damage caused. 

These entities may also be covered by Public Liability Insurance protection that necessitates informing their insurance company as quickly as possible in the event that a claim develops.

Let CCW Global Help You

CCW Global Ltd is an independent insurance broker with over a decade of experience in helping our clients navigate the confusing world of insurance. Part of this is our ability to assist our policyholders steer their lives around any catastrophes that may occur.

From ensuring that you have the right coverage in place to handle all the risks in your life, to offering dedicated claims support when those risks happen, our expert advisors and claims executives know what you’re going through and what you need to overcome the challenges you’re facing.

If you are a CCW Global client who has been impacted by the recent Hong Kong storms, please reach out to us and speak with one of your advisors today. Whether you want to check your coverage status, or you need support in processing your home claim quickly so that you can get back to living, we are ready and waiting to help you with all your insurance needs today.

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