Wednesday, 26 February 2025

The Insurance Council of Australia (ICA) today welcomed the Queensland Government’s announcement of betterment grants of up to $10,000 for insurance customers impacted by the recent storms and flooding in north Queensland.

The extreme weather event, which commenced on 29 January and ran for nearly two weeks, has so far generated more than 7,000 claims, with the majority (5,485) related to damage to homes.

The Stronger Homes Grant Program announced today by Premier David Crisafulli, Minister for Disaster Recovery Ann Leahy, and Minister for Housing and Public Works Sam O’Connor will improve the resilience of homes in communities like Ingham, Cardwell, Mission Beach, Tully and Innisfail.

Insurance policies generally cover the replacement of like with like. These grants will allow insurers to undertake resilience improvements to impacted homes that are beyond the scope of the customer’s policy.

Improvements that could be implemented as result of the grants include:
• Raising laundry appliances and AC compressors on plinths or wall brackets
• Raising electrical services
• Replacing wall linings with resilient materials
Depending on the home, the cost of repairs, and the customer’s insurance cover, the program could also support replacing floors with materials such as polished concrete or tiling.

The ICA has long called for ongoing programs to be put in place that help impacted homeowners make their property more resilient to extreme weather.

Today’s announcement coincides with the release of the ICA’s Federal Election Platform, Advancing Australia’s Resilience, which calls for the creation of a ten-year, $30.15 billion Flood Defence Fund to reduce the impact of future floods, moderate insurance premiums for those living with high flood risk, and minimise the financial impact of flood recovery.

There are around 67,000 homes and 24,000 non-residential properties in Queensland facing a two or five percent risk of flooding each year.

Since 2022, Queenslanders have incurred more than $4.5 billion in claims from more than 195,000 flood-related claims.

Quote attributable to ICA Deputy CEO Kylie Macfarlane:

The Stronger Homes Grant Program announced today will make a real difference to those North Queensland residents picking up the pieces from the storms and flooding of earlier this month.

Premier Crisafulli is to be congratulated for putting this program in place and insurers and the ICA look forward to working with the Queensland Government on the program’s implementation.

Reducing flood risk though programs like these not only better protects lives and property, but is the only sustainable way to put downward pressure on premiums which are being impacted by worsening extreme weather, inflation, the increasing value of our assets, and the cost of reinsurance.

Wednesday, 26 February 2025

The Insurance Council of Australia (ICA) has unveiled the industry’s policy recommendations for the next Federal Government, calling for a comprehensive range of initiatives that will protect hundreds of thousands of Australians living in harm’s way from natural disasters, as well as improve insurance affordability outcomes for home owners and businesses. 

The centrepiece of the policy document, Advancing Australia’s Resilience, is a call for a Flood Defence Fund (FDF) – a $30.15 billion investment over 10 years to protect the country’s most at-risk catchments in Queensland, New South Wales and Victoria (list in PDF under Useful Links). 

The proposed FDF would split the $30 billion cost between the Federal Government and the State Governments of New South Wales, Queensland, and Victoria, which are the jurisdictions with the most high and extreme flood-exposed properties.  

The FDF would: 

• Deliver new critical flood defence infrastructure ($15 billion) 
• Strengthen properties in harm's way ($5 billion) 

• Help local Government undertake managed relocation (buy-backs) ($10 billion) 

• Future-proof existing flood mitigation infrastructure ($150 million) 

Flood is Australia’s costliest extreme weather type, but of the 1.36 million properties facing flood risk in Australia it is estimated that more than half do not meet modern flood resilience planning and building standards. Around 298,000 of these properties – 225,000 homes and 73,000 businesses – face at least a two or five per cent chance of flooding each year.  

The FDF is a big idea to confront a big problem – a problem that is predicted to worsen with a changing climate and growing population. The floods of February-March 2022, three years ago this week, caused the loss of 23 lives, devastated communities, and saw insured losses of almost $6.4 billion.  

Striving to protect our communities against a repeat of this level of devastation should be the priority of every policymaker. 

Advancing Australia’s Resilience also outlines other initiatives that would deliver improved outcomes for Australian homeowners and businesses, including:  

• Resilience and mitigation measures: strengthening the Disaster Ready Fund; better data and flood mapping; improving disaster response and funding arrangements; cyclone-proofing Northern Australian homes; better land use planning; improving building resilience 

• Regulatory and legislative reform: abolishing state insurance taxes, right-sizing regulation; undertaking civil liability reform; expanding home ownership with Lenders Mortgage Insurance 

• Business and industry support: lowering risk for small businesses and not-for-profits; addressing motor trades skills shortages; strengthening motor trades skills shortages; enhancing cyber security; improving outcomes for strata communities 

The ICA is committed to working closely with the State and Federal governments on solutions that will help future-proof Australia. 

Quotes attributable to ICA CEO Andrew Hall: 

Insurance premiums have risen over the past few years through a perfect storm of high inflation, taxes and regulations, extreme weather events and ever-increasing risk factors. 

In a cost-of-living crisis, it is important that all our efforts go into measures which will bring downward pressure on premiums, and this can only be achieved through a strong partnership between insurers and governments.  

That’s why Advancing Australia’s Resilience includes a big idea to combat a big problem over the long-term – the creation of a $30.15 billion, ten-year Flood Defence Fund to protect Australians from our costliest natural disaster. 

Consumers however cannot wait for mitigation and risk reduction programs to offer the critical protection and price relief needed. Immediate action is also essential – with tax and regulatory reform offering the best opportunity to ease cost pressure on insurance premiums in the near term. 

Insurers stand ready to play their part in this important reform, but significant new government investment is the only way to reduce extreme weather risk and must underpin our future collaborative endeavours. 

We know there is no silver bullet. However, if we don’t do anything, insurance customers, governments and taxpayers will continue to pick up the much higher costs of rebuilding every time there is a natural disaster and insurance risks becoming unavailable and affordable for those Australians who need protection the most.  

Quote attributable to Kate Cotter, Founder and CEO, Resilient Building Council:

Large-scale resilience investment and innovation is urgently required for Australia to reduce risk and cost of living pressures. We support ICA’s call for big ideas to solve big problems, including the Flood Defence Fund and expansion of the Resilience Ratings Scheme. 

See PDF under Useful Links for more information about the Flood Defence Fund, as well as a summary of other policy initiatives outlined in Advancing Australia’s Resilience.