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Land Use Planning

Improving consumer outcomes for strata communities: Policy Paper

November 28, 2024 by insuranceca

ICA TV: Andrew Hall in conversation with Dr Daniel Mulino

November 22, 2024 by Shannon White

Home Land Use Planning

ICA TV: Andrew Hall in conversation with Dr Daniel Mulino

First released via the ICA's fortnightly newsletter on Friday, 22 November 2024

The Insurance Council of Australia’s CEO Andrew Hall sat down with Dr Daniel Mulino to discuss the findings and process of the House of Representatives Standing Committee on Economics inquiry into insurers’ responses to 2022 major floods claims.

In this in-depth, 50-minute conversation, they explore key themes such as policyholders, pooling, and preparation, while also highlighting the devastating impact of the 2022 floods on communities, and the broader operating environment.

This review process has been critical for our industry, and the ICA strongly supports the Inquiry’s recommendations which would put downward pressure on premiums and help safeguard communities from future extreme weather events. These include the removal of state insurance taxes, ongoing government investment in resilience and mitigation, and changes to land-use planning to prevent further development on floodplains.

This conversation offers valuable insight into how we can continue to improve outcomes for customers and the community.

🎥 Watch the full conversation here:

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New data shows long-term cost of extreme weather

August 18, 2024 by insuranceca

Home Land Use Planning

New data shows long-term cost of extreme weather

News release

Monday, 19 August 2024

New data released by the Insurance Council of Australia (ICA) today shows that the impact of extreme weather on the Australian economy has more than tripled over the last three decades.

Insured losses from declared insurance catastrophes have grown from 0.2 of GDP from 1995 to 2000 to 0.7 per cent for the last five years, meaning extreme weather losses are consuming more and more of our economic resources.*

In monetary terms, over the last 30 years insurers paid an average of $2.1 billion per year to customers impacted by extreme weather events, but looking at just the last five years the average annual cost of extreme weather claims has more than doubled to $4.5 billion, driven largely by the growing cost of flood.**

And while total premium collected by insurers has grown from $50 billion in 2012 to $86 billion in 2023 insurer profits have not kept pace, remaining flat over that period.***

The new data analysis is contained in the Insurance Council of Australia’s Insurance Catastrophe Resilience Report 2023-24, released today.

The Report shows that insurers incurred $2.19 billion in claims from declared extreme weather events in 2023-24, the same amount as was incurred from extreme weather events over the previous 12 months.

However, the number of claims from events in the past 12 months was almost 157,000, 66,000 more claims than the previous period, showing that while the average claim from recent weather events was lower the impact was more widespread.

The costliest extreme weather event of the past 12 months was the Christmas storms that impacted the Gold Coast hinterland as well as areas of New South Wales and Victoria, which drove $1.33 billion in claims.

The event with the greatest impact on individual customers was ex-TC Jasper which hit Far North Queensland in mid-December, where the average claim was $36,000, almost three times the average claim for the Christmas storms.

The Report outlines the policy solutions required to improve community and household resilience to extreme weather, which include improved land use planning, stricter building codes, and ongoing investment in resilience measures such as flood levees and home strengthening.

The Insurance Catastrophe Resilience Report 2023-24 will be launched at Parliament House, Canberra tonight.

www.insurancecouncil.com.au/CatastropheReport

Quote attributable to ICA CEO Andrew Hall:

The ICA’s latest Insurance Catastrophe Resilience Report shows the impact of extreme weather on our communities over the past 12 months.

Flood is Australia’s most costly natural peril, and it’s estimated that around 1.2 million properties face some level of flood risk.

Around 230,000 of these have a 1 in 20 chance of a flooding each year, with a further 420,000 properties facing a 1 in 50 or 1 in 100 annual chance of flooding, odds that translate into higher premiums which can lead to a growing protection gap.

In the last few years Australian policymakers have started to think more seriously about this issue, and in many ways we are leading the world in our approach to extreme weather risk mitigation and insurers’ product offerings that respond to these risks.

But we need to redouble our efforts if we are to manage the impact of worsening extreme weather amid a changing climate.

De-risking is the only sustainable way to reduce the pressure on premiums and close the protection gap: improved planning so no more homes are built in harm’s way, stronger buildings that are better able to withstand extreme weather, greater investment in public infrastructure to protect communities, and an ongoing program of home buybacks where no other mitigation is possible.

 

*ICA Catastrophe Loss data (5-year average) relative to GDP (GDP Index, ABS)
**ICA Catastrophe Loss data, adjusted for CPI
***Estimated from APRA’s published gross earned premium and increased for taxes and charges

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2024-25 Pre-Budget Submissions

February 1, 2024 by insuranceca

NSW Government action on Sydney floodplain development welcome

October 29, 2023 by insuranceca

Home Land Use Planning

NSW Government action on Sydney floodplain development welcome

image

News release

Sunday, 29 October 2023

The Minns Government is to be commended for its decision to halt further development in parts of Sydney’s north-west due to flood risk, the Insurance Council of Australia (ICA) said today.  

This decision announced today in The Sunday Telegraph by Minister for Western Sydney Pru Car and Minister for Planning Paul Scully is clear and strong action that will protect families and businesses from future dangerous flood events. 

This is the first tangible decision by a State Government in response to the agreement by National Cabinet in 2022 that “the days of developing on floodplains need to end”.  

It follows advocacy by the ICA and other peak bodies such as the Planning Institute of Australia and Master Builders Australia for governments responsible for land use planning decisions to significantly strengthen the controls around developments on high-risk flood plains. 

Some residents of Western Sydney have experienced flooding four times in the past three years and the region is one of the most flood-prone in Australia.  

Quote attributable to ICA CEO Andrew Hall:  

“The Minns Government should be commended for taking such a critical decision which will put the safety and wellbeing of future Western Sydney communities first above all other demands. 

“This is a significant shift in thinking about how we make the region safer and improve its risk profile. 

“Insurers appreciate that Sydney is grappling with a housing crisis as the population surges, but repeating mistakes of the past through poor planning decisions would only condemn future generations to trauma and financial loss through devastating flood events while placing further pressure on all insurance premiums. 

“Western Sydney already is one of Australia’s most exposed and high-risk flood areas, due to the topography of the Hawkesbury Nepean basin.  

“To have allowed developments to proceed in these areas in full knowledge of the flood risk would have been unforgiveable. 

“It was never a question of whether these areas may flood; the science, data and modelling show we know they will flood – to put further housing in these areas of unmitigated flood risk would have been a terrible strategy.” 

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Future Proofing Australia’s Resilience

October 24, 2023 by Shannon White

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