Insurance customers have already lodged 3000 claims over two days as ex-tropical cyclone Alfred wreaks havoc on homes and businesses.
Insurance Council of Australia chief executive officer Andrew Hall said it was too early to estimate the total insurance bill.
"However insurers have received around 3000 claims in the past two days and expect many more thousands of claims as residents return to their homes and understand the full extent of the damage," Mr Hall said in a statement.
An "insurance catastrophe" has been declared for southeast Queensland and northern New South Wales, triggering priority treatment for affected policyholders and triaging to ensure those hardest hit receive urgent assistance.
"We encourage impacted policyholders to contact their insurer to begin the claims process," Mr Hall said.
Insured losses of $2 billion were pencilled in by S&P Global Ratings late last week but fears of a category two system making landfall did not come to pass, with Alfred downgraded to a tropical low before hitting the coast between Brisbane and Maroochydore on Saturday night.
Despite the downgrade, Alfred has caused power outages, flooding and falling debris and more rainfall and wild weather is expected.
Ex-tropical cyclone Jasper that hit north Queensland in December 2023 cost $409 million in total, from 10,500 claims.
Cyclone Tracey, which devastated much of Darwin back in 1974, was the costliest cyclone in Australian history, with insured losses of $7.3 billion when normalised to 2023 values.
It was still too early to predict if insurance premiums would rise following the extreme weather event but the council said the increasing frequency and severity of natural disasters was leading to higher costs for customers.
Alfred was moving as a tropical low from Queensland's Bribie Island across the coast and inland towards the state's southwest on Sunday.
Forecasters expected the heavy rain and destructive gusts to continue until Monday.
