Flood Damage: A Disproportionate Risk to Known Exposure

9

The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.

Australia has over 674,000 properties facing a risk of 1-in-100, 1-in-50, or 1-in-20-years. Out of these, 229,455 properties are at a 1-in-20-year risk, equivalent to a 5% annual exceedance probability.

Andrew Hall, CEO of the ICA, expresses the industry's commitment to improve flood response and appreciates the opportunity to submit their findings to the House of Representatives economics committee.

"Our data analysis also reveals that flood damage is wildly disproportionate to the number of exposed properties. By focusing our mitigation efforts on the most affected areas, we can alleviate the burden for everyone," says Andrew Hall, ICA CEO.

Floods often lead to costly insurance claims and have been the primary cause of losses in recent years, mainly due to weather conditions influenced by climate drivers that cause increased rainfall in eastern Australia.

An analysis of the National Flood Information Database shows that more than half of the properties at a 1-in-20-year risk are located in New South Wales, with the majority of the remaining properties in Queensland and Victoria.

The ICA's submission to the committee inquiry on insurers' responses to last year's floods announces the release of a series of policy papers in the coming months. These papers will examine the nation's "protection gap" and affordability of insurance coverage.

In their submission, the ICA highlights key findings from the recent Deloitte report commissioned by the industry, focusing on the floods that occurred in NSW and Queensland in February and March. The report includes recommendations that have been accepted in principle by the ICA.

The ICA emphasizes the need for action to reduce risks, including increased spending on resilience, improved land use planning, and reforms to building codes. Additionally, they draw attention to the impact of insurance taxes on premiums.

The final report from the inquiry is expected by the end of September next year. A hearing, originally scheduled for Wednesday, has been postponed to the new year.

Published:Tuesday, 5th Dec 2023
Source: Paige Estritori

Please Note: If this information affects you, seek advice from a licensed professional.

Share this news item:

Insurance News

Clear

Australian Life Insurers Report Significant Profit Increase in June 2025 Quarter

26 Dec 2025: Paige Estritori

The Australian life insurance sector has reported a substantial after-tax profit of $360 million for the June 2025 quarter, marking a significant increase from the $116 million recorded in the same period the previous year. This impressive growth is primarily attributed to a sharp rise in investment income and improved underwriting performance across key product lines. - read more

Rising Mental Health Claims Impact Australian Life Insurance Industry

26 Dec 2025: Paige Estritori

The Australian life insurance industry is witnessing a significant surge in mental health-related claims, reflecting broader societal challenges and increasing awareness of mental health issues. AIA Australia, a leading life insurer, has reported that mental health claims now account for 23% of its total claims, up from 15% in 2014. This trend underscores the growing prevalence of mental health conditions and their impact on individuals' ability to work and maintain financial stability. - read more

Decline in Australian Life and Income Protection Insurance Premiums

26 Dec 2025: Paige Estritori

Recent data indicates a notable decline in life and income protection insurance premiums across Australia, providing consumers with more affordable coverage options. According to the latest Direct Life Insurance Report from Rainmaker Information, direct life premiums have decreased by 7% since 2024. Similarly, direct income protection premiums have seen significant reductions, with average premiums for waiting periods of 30 days and 90 days decreasing by 12% and 13%, respectively. - read more

Club Marine Marks 65 Years of Leadership in Australian Boating Insurance

26 Dec 2025: Paige Estritori

Club Marine, Australia's largest recreational boat insurer, is celebrating its 65th anniversary in 2024. Since its founding in 1959 as Marine Hull & Liability, the company has grown from a small operation in Victoria to a nationwide provider of insurance services for the country's boating community. - read more

IAG's Strategic Moves Propel Profit Forecast Upward

26 Dec 2025: Paige Estritori

Insurance Australia Group (IAG) has recently announced an optimistic upgrade to its financial guidance for the fiscal year 2026, projecting a 10% increase in gross written premium (GWP) and an insurance profit ranging between $1.55 billion and $1.75 billion. This positive outlook is largely attributed to strategic acquisitions and a focus on digital transformation. - read more

Click for more Insurance News