BREAKING: Insurers make flood recovery “difficult” for Townsville: dealers

Insurance companies are reportedly funneling Townsville vehicle owner claims away from the community’s dealerships, as the city struggles to recover from this month’s devastating floods.

A group of Townsville dealers are calling on big insurance companies to stop funneling claims and their subsequent economic recovery to third-party fleet management firms as customers try desperately to piece their lives back together.

Townsville’s Pickerings Mitsubishi dealer principal Scott McElligott tells AutoTalk customers are coming into his and other dealerships with just the clothes on their backs to file a claim on their flooded, destroyed vehicles.

“These vehicles are an essential service for some people in a community where public transport is not always available, and customers are coming to us – some with just a change of clothes in a plastic bag – asking for our help to start getting their lives back together,” he says.

“Most, but not all insurance companies, are making the process extremely difficult and they’re shovelling the business out of town, which makes the flood recovery even harder,” McElligott explains.

Dealership businesses Key Motors, Carmichael Ford, Parry Nissan and Pickerings Automotive Group are calling on insurance companies and government to put the town’s economic recovery first.

The Townsville car dealer strip on Sturt Road features top-selling brand franchises with Parry NQ (Nissan/Renault, Suzuki), Pickerings Auto Group (including Volkswagen/Skoda, Hyundai/Kia, Mitsubishi, BMW/MINI, LDV/MG, RAM Trucks), Tony Ireland Group (Holden, Jaguar Land Rover, Volvo) and the Townsville Auto Group (Isuzu Ute, Haval/Great Wall, Chrysler Jeep, Honda).

Key Motors (Subaru, Mazda) on Dalrymple Rd, Carmichael Ford and Magnetic Motors (Mercedes-Benz Townsville) on Charter Towers Rd, plus Mike Carney Toyota on Duckworth Rd, are more big brands in the town of circa-180,000 people.

According to McElligott, he estimates roughly 10,000 vehicles are in need to replacement, flooded out, physically destroyed by flood waters, or just plain missing. Pickerings currently has around 200 loan cars worth more than $6 million out with customers as a means of assistance.

“This has nothing to do with any kind of sales boon for any of us, because it’s nothing even remotely close to that,” he says in defiance of the car dealer stigma.

“This is about a smashed community, which includes our friends and family, trying to repair itself,” he says, deflated.

“We all agree it’s a massive job to replace all those cars, but the first priority should be to keep the business local, because we’re already doing everything we can to help people who don’t even have their wallet or phone on them,” McEligott says.

“But the insurance companies are bringing in cars from out of town – away from our dealerships which need to stay open so our staff have security and can recover themselves,” McElligott reveals.

Only just this week have many of the Pickerings dealership staff finally returned to work after losing their homes, their possessions and their dignity.

McElligott says he won’t reveal which insurance giants are to blame, but says it’s putting local businesses and staff at risk.

“Townsville dealerships need Townsville business, we need local support and they need us, but if insurance companies are passing the work to third-parties and leaving us out of the loop, we’re all sifting through the mud with one had tied behind our backs,” McElligott appeals.

According to the DealerNomics data tool, the franchised new car dealers of Townsville in the Herbert electorate, employ over 460 people, contributed $67.61 million in wages and other expenses, and made an economic contribution of nearly $97 million last year with $438 million in turnover.

Water levels in some suburbs reached 1.5 metres after the region copped unprecedented 1454mm in just 26 days of 2019 according to Elders Weather.

Monsoonal rains reached their peak at 20 times the average for the time of year, generating more than 21,500 claims received by insurers, with losses estimated at $886 million according to the Insurance Council of Australia.

ICA declared the Townsville flood a catastrophe early this month, and last week one of two insurance forums was held in Townsville where more than 150 policyholders met with Suncorp, RACQ Insurance, IAG, QBE, Allianz, CommInsure, Youi and Westpac Insurance representatives regarding their home and contents policies.

Joining the forum were politicians including local MP Cathy O’Toole, Senators Anthony Chisholm
and Jenny McAlister, and Townsville Mayor Jenny Hill, and federal opposition leader Bill Shorten.

Insurance Council of Australia (ICA) spokesperson Campbell Fuller says in a statement policyholders appreciated the opportunity to sit down with their insurers to discuss their personal circumstances.

“Though the claims process is well advanced for many policyholders, and hundreds of claims have already been finalised, the ICA recognised some claimants had unresolved questions or concerns,” he says.

“The forum allowed householders and small businesses to ask their insurer about the progress of their claim, including assessments and the repair and rebuilding process,” Fuller continues.

“Insurers recognise these catastrophes cause emotional and financial trauma for many in the community, and are doing all they can to help policyholders to get back into their homes and businesses quickly,” he adds.

AutoTalk has approached the Insurance Council of Australia for comment on vehicle claims.