A Sydney-based insurance giant will not be seeking legal action after a landmark class action relating to the devastating 2011 floods in greater Brisbane and Ipswich ruled in favour of almost 7,000 claimants.
The NSW Supreme Court found the Queensland government and the operators of Wivenhoe and Somerset dams were negligent in managing the deluge, for which insurance companies paid out $1.5 billion in claims.
IMF Bentham, the company that funded the legal action, estimated the case would deliver up to $130 million; while the insurance industry said firms could be looking at the commercial implications of the flooding.
Insurance Australia Group (IAG), with a network of brands including NRMA, RACV, and Coles Insurance, said it will not launch legal action to recoup from those at fault what it paid out to customers, AAP reported.
Suncorp Insurance has not commented on the ruling.
Campbell Fuller, Insurance Council of Australia spokesman, said any potential legal action by firms looking to retrieve losses “won’t impact the customers from an insurance perspective.”
“Any action that insurers take from here won’t affect what has already taken place between insurers and their customers,” Fuller told the news agency.
The ICA spokesman also said it is up to insurers whether or not they would seek legal action.
“The decision from the court named responsible parties, so insurers will be examining that and determining their next course of action,” Fuller told AAP. “That will be on an individual basis – each insurer had a different level of exposure to the floods.”