The Insurance Council of Australia (ICA) has declared the deadly coronavirus (Covid-19) outbreak as an insurance catastrophe.
The declaration is effective since 12 March 2020, following the World Health Organization (WHO) classifying the virus outbreak as a pandemic.
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The Covid-19 pandemic has so far killed more than 6,500 and infected more than 169,000 people around the world.
As the insurance industry prepares itself for a flood of claims, the ICA also launched a special task force to capture virus-effected claims data on a real-time basis.
ICA spokesman Campbell Fuller said: “The main purpose is to assist in better understanding the impact of COVID-19 on consumers and business and to assist the government in their responses.
“It means insurers will start providing information and data so the Insurance Council can best help the government in its deliberations.
“In this instance, it’s a fairly low key declaration. It’s more of a reference declaration, designed to assist in better understanding the true impact of the disease.”
The ICA expects a significant surge in coronavirus-related claims especially from travel and business interruption insurance.
Most claims, especially travel insurance policies, may have exclusions and may not be paid out because they do not extend cover to pandemics and epidemics.
On the contrary, the existing policies bought prior to the declaration can still cover travellers who are overseas.
In terms of life insurance policies, ICA believes that the existing policies will have no exclusions.
As of 12 March 2020, Australia has a total of 126 confirmed cases, New South Wales (NSW) being the highest hit region, with around 60 cases.
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