Insurance Council of Australia

Resilience Investment

ICA welcomes Federal funding for Qld resilience package

by

ICA welcomes Federal funding for Qld resilience package

image

News release

Thursday, 7 April 2022

The Insurance Council of Australia (ICA) has welcomed the Federal Government’s decision today to agree to fund half of the Queensland Government’s $741 million extreme weather resilience package.

Improving the resilience of homes and communities at risk of impacts from floods, cyclones and bushfires is the responsibility of all levels of Australian governments.

That is why the Insurance Council supports comments made by the Prime Minister this morning that state and territory governments need to strengthen land use planning arrangements, improve building standards, and remove taxes on insurance which only decrease adequate insurance cover.

The Insurance Council has already called for the Federal Government to commit to matched funding of similar programs in other states and territories as outlined in the ICA’s recent Building a More Resilient Australia report and as recommended by the Productivity Commission.

The $2 billion, five-year investment pipeline set out in the report, half funded by the Federal Government and half by the states and territories, is estimated to save governments and households at least $19 billion to 2050.

Shared funding is required on the following basis:

Jurisdiction

Investment $m

Return $m

ROI

Queensland

726

6,290

9

Northern Territory

16

313

20

ACT

4

17

4

New South Wales

232

5,651

24

Tasmania

46

938

21

Western Australia

192

979

5

Victoria

223

3,185

14

South Australia

30

1,361

46

Not allocated

532

522

1

 

2,000

19,256

10

Quote attributable to ICA CEO Andrew Hall: 

Today’s decision by the Federal Government is very welcome, and we hope it’s the first of a series of announcements to split funding with states and territories on measures to better protect communities and homes from the impacts of extreme weather.

Resilience and mitigation funding is an investment into future protection, and we support comments by the Prime Minister for other states and territories to do more to improve community resilience in their own jurisdictions.

Unless we can reduce the risk with stronger homes located in the right places, extreme events will continue to cost taxpayers millions of dollars, and the mental health and trauma of communities will continue to be experienced. 

 

Useful links

icon Media Release
icon Lorem ipsum
icon Ducimus qui blanditlls

Federal decision on Queensland resilience funding disappointing

by

Federal decision on Queensland resilience funding disappointing

image

News release

Wednesday, 6 April 2022

The Insurance Council of Australia (ICA) today expressed its disappointment in the Federal Government’s decision to not contribute to the Queensland Government’s extreme weather resilience package.

Last Month the ICA welcomed the Queensland Government’s announcement of a $741 million Resilient Residential Recovery package to better protect Queenslanders from the impacts of extreme weather events, such as flood and cyclone.

The Queensland Government had requested that the Federal Government fund 50 per cent of the package, which was designed to assist Queenslanders pay for resilience measures such as retrofitting and raising homes in flood impacted areas.

The ICA has long been calling for the Queensland Government to lift its investment in this area, and late in February released its Building a More Resilient Australia report which called for $726 million to be invested jointly by the Queensland and Federal Governments over the next five years.

Building a More Resilient Australia calls for Federal Government investment in measures to better protect homes and communities from the impacts of extreme weather to be doubled nationally to $200 million a year over five years, and for this to be matched by the states and territories.

Last week, the ICA welcomed the Federal Government’s 2022-23 Budget announcement of $268 million in related measures to better protect Australians from the impacts of extreme weather.

While the two-year commitment to resilience funding was welcome, sustained and greater funding in this area is required if the risk profile of communities exposed to extreme weather is to change.

A poll undertaken last month for the ICA found that 68 per cent of people living in Greater Brisbane say that not enough is being invested by governments at all levels to protect homes and communities from extreme weather events, with 62 per cent calling for funding to at least double.

Fifty-two percent of those surveyed in the Queensland capital believe funding of this important protection is the responsibility of the State and Federal governments equally.

As of Friday 1 April, more than 92,700 claims had been lodged in Queensland in relation to the March floods, with an estimated claims cost of $1.3 billion.

Quote attributable to ICA CEO Andrew Hall:

As severe rain and flooding continues to impact the east coast the failure of the Federal Government to match Queensland’s investment in measures to improve household and community protections against extreme weather is disappointing and short-sighted.

If Australia is to get serious about improving our resilience to flood, bushfire and cyclone, all levels of government must contribute.

Australians – particularly those still impacted by the ongoing rain and flooding – want governments to come together to provide better protections against worsening extreme weather, not wash their hands of responsibility.

Useful links

icon Media Release
icon Lorem ipsum
icon Ducimus qui blanditlls

Reinsurance Pool legislation passes

by

Reinsurance Pool legislation passes

image

News release

Wednesday, 30 March 2022

The Insurance Council of Australia (ICA) today welcomed the passage of legislation to enable the establishment a Reinsurance Pool for cyclone and cyclone-related flood for homes, strata corporations and small businesses.

It is now incumbent upon the Australian Reinsurance Pool Corporation (ARPC) to release its pricing schedule to give the sector time to price in reinsurance costs and provide visibility to policyholders on expected premium reductions.

The insurance sector has worked constructively with the Federal Government since the Pool was announced in the lead up to last year’s Budget and will continue to engage with the ARPC, Treasury and the ACCC in the lead-up to implementation, planned from 1 July this year.

A Reinsurance Pool is just one lever available to influence premium prices in cyclone-impacted regions of Australia.

To achieve sustainable premium reductions for those exposed to the risk of extreme weather, including cyclones, governments must increase investment in local infrastructure and household-level programs.

That’s why last month the ICA released Building a More Resilient Australia, which set out an investment pipeline of $2 billion over five years jointly funded by the Federal and state governments to better protect communities and households from cyclone, flood, and bushfire risk.

Quote attributable to ICA CEO Andrew Hall:

Insurers welcome the passage of the reinsurance pool legislation, which is an important next step on a very complex issue.

The Pool is scheduled to commence in just three months, so it’s vitally important that insurers and their customers are able to understand how and to what extent this will impact on premiums.

We look forward to the ARPC releasing that information as soon as possible.

However, a Reinsurance Pool is just one piece of the puzzle.

The recent and ongoing floods have shown the urgent need for investment in measures to better protect homes and communities.

While we welcomed the increased funding in last night’s Budget for those communities impacted by this year’s floods, there are dozens of other communities in Australia that remain exposed to perils like cyclones and require similar assistance to uplift their mitigation.

In the lead up the election in coming weeks it is incumbent upon the Government to not only assist with recovery, but announce further investments to better protect communities from the impacts of extreme weather.

Useful links

icon Media Release
icon Lorem ipsum
icon Ducimus qui blanditlls

New survey shows community backs resilience investment

by

New survey shows community backs resilience investment

image

News release

Monday, 21 March 2022 

Two thirds of those living in communities impacted by the recent floods do not believe governments are investing enough to protect homes and communities from extreme weather events, a new survey undertaken for the Insurance Council of Australia (ICA) has found.

More than 90 per cent of those who want more invested think government spending in measures to better protect against extreme weather should at least double, with 57 per cent saying whatever is required should be spent.

The survey of more than 1,000 people from three flood-impacted regions in SE Queensland and New South Wales found that 51 per cent believe state and Federal governments have equal responsibility for this area, 22 per cent say state governments, and 11 per cent say the Federal Government.

An overwhelming 94 per cent of people surveyed say there should be better controls on where homes are built so they are not at risk of flood.

Flood-impacted communities have a strong understanding of what is driving insurance affordability and availability constraints, with 47 per cent saying the reason flood cover can be difficult or expensive to obtain is the risk of flood and 11 per cent citing climate change, with just one in five saying this is driven by insurer profits.

Alarmingly, 37 per cent of those surveyed say they don’t have enough insurance to rebuild if required.

Last month the ICA released its election platform, Building a More Resilient Australia, which called for a range of measures to better protect households and communities from the impacts of extreme weather and put downward pressure on premiums, including:

  • A doubling of Federal funding to $200 million a year over five years for household retrofits and community protection projects, matched by the states and territories, to fund measures including:
  • $522 million for local projects such as flood levees to defend regional towns
  • $413 million to better protect homes against flood by raising utilities and services above the expected floodline
  • $37 million for an improved national flood early warning system, estimated to increase the lead time for flood warnings from 3-5 to 10-15 days
  • Better land use planning so no more homes are built in harms’ way
  • Update the national building code to include building resilience as a standard
  • Remove state taxes and charges on insurance, which numerous inquiries have found to discourage adequate cover by driving up the cost of premiums.

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

The Insurance Council has long called for greater investment in measures that better protect homes and communities from the impact of extreme weather.

This most recent flood has unfortunately brought this issue into sharp relief, and now those directly impacted have added their voices to this call.

With two thirds of those impacted by the most recent devastating floods calling for funding to be significantly increased, it’s way past time for governments to act.

Impacted communities clearly want state and federal governments to work together to solve this issue and see both levels of government equally responsible.

The community also clearly understands the folly of allowing development to take place on floodplains.

Insurers have a ready-made plan for investment in projects that will better protect extreme weather-exposed communities.

We’re also ready to start work with governments to review land use planning, improving building standards, and removing state taxes on insurance products.

-------------

About the survey: This quantitative research study was sampled using Kantar Profile’s Lifepoints network, on behalf of the Insurance Council of Australia from Friday, March 11 to Monday, March 14, 2022. More than 1,000 people of all age groups were surveyed across flood-impacted regions including the Northern Rivers and Western Sydney in NSW and Greater Brisbane in Queensland. Respondent data was subject to standard data quality and engagement checks, including digital fingerprinting to ensure unique respondents only.

Useful links

icon Media Release
icon Lorem ipsum
icon Ducimus qui blanditlls

Insurance Council welcomes Queensland funding boost

by

Insurance Council welcomes Queensland funding boost

image

News release

Saturday, 19 March 2022

The Insurance Council of Australia (ICA) today welcomed the Queensland Government’s announcement of a $741 million Resilient Residential Recovery package to better protect Queenslanders from the impacts of extreme weather events such as flood and cyclone.

The ICA has long been calling for the Queensland Government to lift its investment in this area, and just last month released its Building a More Resilient Australia report which called for $726 million to invested jointly by the Queensland and Federal Governments over the next five years.

The ICA supports the call by the Queensland Government for the Resilient Residential Recovery Package to be jointly funded by the Federal Government.

Building a More Resilient Australia calls for Federal Government investment in measures to better protect homes and communities from the impacts of extreme weather to be doubled nationally to $200 million a year, and for this to be matched by the states and territories.

The report outlines a five-year, $2 billion funding program which includes:

  • $522 million for local projects such as flood levees to defend regional towns, including Mackay, Innisfail, Dalby and Rockhampton
  • $413 million to better protect homes against flood, Australia’s most expensive natural peril, by
  • raising utilities and services above the expected floodline
  • $221 million to cyclone-proof more than 44,000 homes in Northern Australia
  • $37 million for an improved national flood early warning system, estimated to increase the lead time for flood warnings from 3-5 to 10-15 days

As at midday Friday 18 March more than 85,000 claims had been lodged in Queensland in relation to this month’s flooding with an estimated claims cost of $1.285 billion.

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

This announcement highlights that governments are shifting in their thinking, to learn from the lessons of the current disaster and invest in mitigation ahead of the inevitable next event.

Three weeks ago the ICA released actuarial modelling that called for these kinds of funding commitments to be made and we are pleased governments are heeding this important call.

We look forward to further announcements by the Federal Government, not just for Queensland and New South Wales, but across the country where communities remain vulnerable to extreme weather.

Insurers hold significant data and research that can assist in resilience and mitigation efforts and we stand ready to assist the Queensland Government following its announcement.

We note that the funding will be across a range of mitigation measures, including, at the extreme, the buyback of properties that are highly vulnerable and whose owners struggle to find insurance cover.

 

Useful links

icon Media Release
icon Lorem ipsum
icon Ducimus qui blanditlls

ICA Welcomes Federal Government Disaster Fund

by

ICA Welcomes Federal Government Disaster Fund

image

News release

Friday 18 March 2022

The Insurance Council of Australia (ICA) has today welcomed the Federal Government’s decision to draw down on its Emergency Response Fund and inject $150 million to communities devastated by the recent floods. 

The Queensland and New South Wales governments will each receive $75 million to assist in immediate disaster recovery, as well as much-needed funding for future disaster risk mitigation and resilience initiatives. 

The Insurance Council and insurers have long been calling for greater investment in making homes, businesses and communities more resilient in the face of worsening extreme weather. 

Late last month, the Insurance Council released our election platform, Building a More Resilient Australia, calling for a doubling of Federal funding to $200 million a year matched by states and territories. 

The platform called for a range of measures to better protect households and communities from the impacts of extreme weather and put downward pressure on premiums. 

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

In the past two weeks we have seen millions impacted by worsening extreme weather as a result of climate change.  

The devastation we have witnessed is evidence of the urgent need to improve community resilience in areas with high risk of extreme weather impacts. 

We welcome this much needed investment, not only for communities in desperate need of help now but which, when the time comes to build again, will need investment that makes them safer and more resilient.  

Useful links

icon Media Release
icon Lorem ipsum
icon Ducimus qui blanditlls
The voice for a resilient Australia

We are the representative body of the general insurance industry in Australia, shaping positive outcomes for our members, our people and the community.

Subscribe to our newsletter

Acknowledgement of Country

We acknowledge the Traditional Owners on the many lands the people of the ICA reside and work. We respect and honour Aboriginal and Torres Strait Islanders Elders past, present, and emerging.
Read on

Footer

Social