Counsel Assisting Rowena Orr has returned and is outlining issues with natural disaster claims.

Consumer groups have told the commission about a range of problems including underinsurance and denial of claims.

Ms Orr refers to a submission by Legal Aid NSW, which claims insurers fail to understand the trauma experienced by those who lose their homes.

Ms Orr gave the example of an eight-year-old boy whose family lost its home in a bushfire. The boy was asked by an insurer to list all toys destroyed in the fire.