Driving home the escalating costs of flooding in Australia, the Insurance Council has released data that shows the country has suffered AU $8.8 billion of insured losses from floods just since 2019, while insured losses from the flooding earlier this year continue to creep higher.
That’s around US $5.65 billion of insurance and reinsurance market losses from the flood peril in Australia alone in a three year period.
The most impactful flood event, which was the severe flooding that struck eastern regions of Australia in February and March 2022, continues to see its losses rise.
The Insurance Council of Australia (ICA) provided another update on this event today, now pegging the total bill for its insurers at $5.56 billion from more than 236,000 claims, with around half of the losses in New South Wales.
That flood event is now the equal costliest extreme weather event in Australia’s history, alongside the 1999 Sydney hailstorm.
The flooding earlier this year also drove losses to the reinsurance market, as well as to some ILS contracts.
Andrew Hall, CEO Insurance Council of Australia, commented, “Since 2019 insurers have received more than 577,000 claims related to declared flood events to the value of $8.8 billion.”
After a joint announcement by the Federal and New South Wales Governments of an $800 million Resilient Homes Program, that will largely be spent to retrofit properties and make homes in the Northern Rivers more resilient to flood, Hall said this was an important step.
“Today’s announcement is a necessary and significant investment in better protecting communities at most risk of flood, and demonstrates that both the Federal and New South Wales Governments understand the scale and complexity of the policy solutions required to begin to address this worsening threat,” he explained.
Adding that, “For insurers to continue to provide cover at an affordable price and for property and lives to be protected, not only is action required to strengthen the resilience of existing homes and communities, but we must shift our approach to what we build and where we build it.”
The ICA last pegged the industry loss from the flooding earlier this year at AU $5.28 billion back in August.
Since then, PERILS AG has estimated the industry loss from those floods at nearly AU $6.3 billion.