Wednesday, 7 June 2023

The Insurance Council of Australia (ICA) today said the announcement of a $400 million investment in 187 resilience and mitigation projects marks a new era in protecting communities exposed to extreme weather risk.

The Federal Government’s $200 million Disaster Ready Fund (DRF), matched by states and territories, is an important milestone towards building stronger community resilience to extreme weather and will have an impact on premium pricing and reducing the protection gap.

In a report released last year, Building a More Resilient Australia, the Insurance Council identified key projects to make communities more resilient in the face of worsening extreme weather.

Among the projects identified were flood levee design and upgrades and improved hazard data and mapping capabilities, which have been announced in this first round of the DRF.

These, as well as the ongoing coordinated national approach from governments and insurers through the Hazard Insurance Partnership (HIP), will work to lessen the impact of extreme weather.

The damage bill for extreme weather events since the 2019-20 bushfires has now exceeded $13 billion, including a record year for insurance payouts in 2022, with almost $7 billion in extreme weather claims.

Given the ongoing threat of climate change, the Insurance Council has called for the DRF to be extended to a 10-year rolling program and for the funding to be indexed so it doesn’t fall in real terms.

An ongoing DRF would ensure that Australians receive the benefits of resilience and mitigation investment for years to come and allow governments and communities to plan for long-term projects.

Comment attributable to Andrew Hall, CEO Insurance Council of Australia:

For many years the insurance industry has focused its advocacy on government investment to improve community resilience to worsening extreme weather, and today we are seeing this hard work pay off for Australian communities.

Emergency Management Minister Murray Watt is to be commended for his dedication to see projects identified and funding committed within a year of the DRF announcement, and we thank him for continuing to collaborate with insurers on this important topic.

The cost of worsening extreme weather is impacting the affordability and availability of insurance in some parts of Australia, and we know a key lever to improving insurance outcomes is reducing or mitigating the risk that is present.

The states and territories have a key role to play in reducing risk for communities and so we thank them for matching this first round of DRF funding.

We need to see this same level of funding for at least the next 10 years to ensure that Australians receive the full benefits of resilience and mitigation investment, including stabilising insurance premiums in areas at high risk of extreme weather.

Monday, 29 May 2023

The Insurance Council of Australia (ICA) has declared a Significant Event for the Hunter and Central Coast regions of New South Wales impacted by hailstorm on the afternoon of Friday 26 May.

The ICA’s preliminary catastrophe processes have been activated, assisting the ICA and insurers to assess the insurance impacof the hailstorm.

Under a significant event declaration: 

• The ICA commences its claims data collection, analysis, and reporting processes in consultation with members.  
• ICA representatives will continue to work with government and agencies to understand impacts on the community and ensure affected residents receive assistance. 

As of 10am today, insurers had received 7,552 claims relating to the hailstorm, with 6,021 of those for damage to motor vehicles.

If property or vehicle has been impacted, customers are advised to contact their insurer as soon as possible to commence the claims process, even if they do not know the full extent of damage.  

Comment attributable to Andrew Hall, CEO Insurance Council of Australia:

The insurance industry has made this Significant Event declaration to activate services and support for affected motorists, homeowners and businesses and reassure them that their insurer is there to help. 

It’s too early to understand the full extent of the damage in affected areas and to estimate the insurance damage bill, however we know that most of the damage has been to motor vehicles.

The ICA would like to urge those affected to talk to directly to their insurer, to be aware of any unauthorised people taking advantage of the widespread damage, and to report any suspicious activity or interaction to government authorities or police.