The Bureau of Meteorology warned that a second storm cell was gathering off the coast north of Sydney, with gale force winds of up to 100 km per hour (62 miles per hour) and heavy winds hitting the coast.

"We still have some difficult hours ahead of us as this weather pattern continues to move through," New South Wales state premier Mike Baird told reporters.

"It's still very dangerous," he said. "We're seeing a continuation of the wind, rain, flash flooding."

Three people, two men and a woman, were found dead on Wednesday in the town of Dungog, about 200 km (125 miles) north of Sydney. Media reports described them as elderly and said they were trapped in their homes as floodwaters rose.

The State Emergency Services said three people were missing near the town of Maitland, around 165 km (100 miles) north of Sydney, after their cars were washed away by flood waters.Amateur video showed a house in Dungog floating away as floodwaters swept through the town.

The Insurance Council of Australia declared the storms a catastrophe on Wednesday as thousands of claims worth hundreds of millions of dollars rolled in.

"There's no doubt there will be a natural disaster declaration ... and obviously we want to get on with the job of recovery as quickly as we possibly can," Baird said.

Cyclone-strength winds of up to 135 kph (85 mph) and heavy rain across the state have uprooted trees, some crushing cars, and snapped power poles. Transport networks have been hit, with train stations and roads flooded and traffic lights knocked out.

Three hospitals were without power and had to rely on generators and hundreds of schools were closed.
Huge waves, reaching 11 metres (36 feet) offshore, pounded beaches, closing many, including world-famous Bondi.

A cruise ship with 2,500 passengers that spent two days off the Sydney coast after Sydney Harbour was closed to commercial shipping, was finally guided into port on Wednesday morning. (NDTV)