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Business interruption insurance for February 2024 Victorian power outages


Business interruption insurance for February 2024 Victorian power outages

More than 500,000 Victorian homes and businesses were left without power following a substantial storm on 13 February 2024 that downed powerlines across the state and shut down the Loy Yang A power station in the Latrobe Valley (which generates around 30% of Victoria’s power). If you have business interruption insurance as part of your business insurance policy, you may be able to claim for your losses associated with the storm and power outages.

FREE legal advice about your business insurance entitlements after the storms:  03 9448 8048


Many businesses caught up in the power outages were unable to operate normally with the lights off and without access to power. Cafes, restaurants, supermarkets and other food providers had their fridges turn off, spoiling thousands of dollars in perishable stock.

Some businesses were inaccessible due to downed trees and power lines, causing dangerous road conditions and road closures. Other businesses were unable to operate for other reasons related to the storm.

Although each business interruption insurance policy is different, most policies will cover business losses caused directly or indirectly by accidental damage due to a number of insured events – including storms that damage public utilities.

What is business interruption insurance?

Many businesses have business interruption insurance which pays out money if your business is impacted by an insured event. The money you are paid is usually paid to cover a drop in income or profit and for additional expenses of the business, but can also cover the costs of replacing equipment and stock.

Business interruption insurance is usually part of your insurance policy covering damage to the business premises, contents, public liability and professional indemnity.

You can learn more about business interruption insurance in our earlier blog, “Business interruption insurance & natural disasters”.

It is important that you check your policy to see if you are covered.

If you have experienced business losses in the recent Victorian storms (or any other natural disaster or event), and you’re unsure about your insurance cover, call us for some free advice.

NOT SURE? GET FREE ADVICE:  03 9448 8048

Claiming business interruption insurance for power outages and damage to utilities

In addition to claims for direct damage to your business premises caused by storms (including the February 2024 extensive storm damage across Victoria), claims can also be made for interruption caused by physical damage to utilities as a result of a storm (e.g. where power lines go down or power stations are damaged).

Some policies may include waiting periods, which may mean up to the first 72 hours of losses are not covered. However, many policies have no waiting periods at all – meaning you can claim for immediate losses, even if you were only impacted for one day of trading.

You may be able to claim for the loss of income or profit your business suffered because of the power outages. You may also be able to claim the additional costs you incurred to return to normal trading or to save stock (e.g. the costs of running generators). In some circumstances, you may also be able to cover the cost of replacing perishable stock that was damaged because of the power outages.

Mitigating your business losses after a storm event

If your business remains without power, it is important that you take steps to mitigate your loss. If you don’t take such steps, your insurer may be able to refuse or reduce your business interruption insurance benefits under your insurance policy.

Mitigation steps for businesses without power may include hiring generators to provide power to your business until utilities are repaired and power is restored. Other steps may include moving perishable stock offsite to places with working refrigeration.

You may be able to claim the costs of taking these steps to return to normal trading or save perishable stock under the “increased costs of working” cover usually included in business interruption policies. You should keep a record of any extra costs you incur due to the power outages, such as invoices or receipts.

What if the insurance company rejects your business interruption insurance claim or doesn’t pay your full benefits?

If your insurer refuses to pay your business interruption claim, you can lodge an internal complaint to seek a further review through the insurer’s internal dispute resolution (IDR) processes. The insurer will need to respond to your IDR complaint within 30 days.

If your insurer still refuses your claim, you can initiate court proceedings to sue your insurer, or you can lodge a complaint with the Ombudsman – the Australian Financial Complaints Authority (AFCA).

We can act for you “no win/no fee” in any court case or AFCA complaint if your insurer rejects your claim.


You can learn more about appealing insurance company decisions in our earlier blog, “Three options to appeal a rejected insurance claim”.

Loss assessments by the insurer can be appealed

If your insurer accepts your claim, they will likely send your claim to a loss assessment from a forensic accountant appointed by the insurer. Loss assessments from insurers often get it wrong and don’t pay out the full benefits that you may be entitled to.

We can check any loss assessments your insurer comes up with and can provide you with free advice on whether you are entitled to more.

Free insurance cover check

If your business has suffered loss in the February 2024 Victorian storms (or in any other natural disaster or event), we will check your business insurance policies for free and tell you what you can claim.

We will also act for you on your insurance claims and appeals (if your claim is rejected or you have any other dispute with the insurer) on a “no win/no fee” basis. We help businesses all over Australia.

Contacting Berrill & Watson

📞 Melbourne: 03 9448 8048

📞 Brisbane: 07 3013 4300

📞 Anywhere else in Australia:  03 9448 8048

📧 [email protected]

How we charge

We are Australia's best-value superannuation/insurance law firm. Other law firms charge nearly double (& sometimes more than double) what we charge. So, if you get a quote from them, or have a cost agreement, ask us what we will charge you.

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