In 2023, the Insurance Council engaged the Centre for International Economics to undertake a high-level economic analysis of the potential benefits of recognising building resilience in the National Construction Code to support our advocacy objective.
To download the report, click here. To download the Insurance Council’s summary report, click here.
The report identifies and quantifies the main impacts that could potentially be avoided through more resilient buildings, including:
- costs associated with rebuilding or repairing damaged buildings
- costs associated with replacing and repairing home contents
- disruption related costs including temporary accommodation, stress and mental health issues
The report’s high-level finding is that annual residential building costs from the extreme weather events addressed by the NCC (bushfires, cyclones and floods) are around $4 billion per year.
Strengthening the NCC to require new to be made more resilient to extreme weather could reduce average annual building related costs by an estimated $2 billion per year for cyclones, $1.475 billion per year for floods, and $486 million per year for bushfires.
The CIE analysis shows that flooding causes expensive damage, reducing the cost-benefit of some building measures targeting flood. The study supports ICA’s call to see states and territories reform planning rules so that new homes are not built in high-risk areas of the floodplain.
These report estimates costs double by 2050, as events become more severe or more frequent because of climate change. Strengthening the NCC could play a significant role in reducing these costs.