The general view taken by the general insurance industry is that flooding of a property by rainwater would normally be regarded as storm damage.
Currently insurers define ‘flood’ differently. The definition your insurer is using in your policy will be stated in the Product Disclosure Statement (PDS). Broad agreement has been reached on a common definition of ‘flood’ as part of the reforms announced by the Federal Government.
Various flood insurance offerings are now available in the market. Some insurers offer mandatory flood cover. Others allow you to opt out of flood cover. Some still exclude flood damage, although this is likely to change with the introduction of amendments to the Insurance Contracts Act. It is important that you select the cover that suits your situation. The source of the water that damages a property will be a critical factor in an insurer’s decision about whether the damage is covered under an insurance policy. You should refer to your PDS to see whether your insurer covers you for flood and/or storm damage. If you are confused about what you are covered for, contact your insurance company