Insurers will have a formal role in how New South Wales prepares for and recovers from disasters. The state's disaster agency and the industry's peak body have signed an agreement as the storm season is already generating claims around Sydney.
The NSW Reconstruction Authority (RA) and the Insurance Council of Australia (ICA) announced a memorandum of understanding (MoU) on Monday. It covers data sharing, joint planning and community engagement before, during and after disasters.
The agreement formalises something the ICA has sought for more than two years. In mid-2024 it told a parliamentary review of the RA’s founding legislation that every state and territory should set up standing recovery arrangements with insurers.
The two organisations will share information and data, plan jointly for recovery and coordinate how they engage with affected communities. The MoU also recognises that insurers take part in the RA’s Recovery Centres and outreach work, where residents and business owners can get help with insurance questions after an event.
Insurers will also be consulted earlier when the RA designs recovery policy and programs, including the government clean-up schemes that run after floods and storms.
RA chief executive Kate Fitzgerald said the agreement gave government and insurers a clearer way to pool what they know about conditions on the ground and to coordinate support through Recovery Centres. She said the work done before disasters strike was just as important.
“By building these relationships before they are needed, we can provide a more coordinated recovery when communities are dealing with the impacts of a disaster,” said Fitzgerald.
ICA chief executive Andrew Hall (pictured) said insurers had received more than $4.79 billion in extreme weather claims in NSW alone since 2022. He said closer cooperation should help both sides spot community needs earlier and guide residents and businesses through recovery. He also urged other states to sign similar agreements.
The NSW deal follows a trans-Tasman partnership the ICA formalised with its New Zealand counterpart in June. It is the second formal coordination agreement the peak body has signed this year.
In its June 2024 submission to the Joint Select Committee on the NSW Reconstruction Authority, the ICA argued that coordination with insurers should become more formal and effective. Its follow-up answers to the committee in September that year said the arrangements would need year-round engagement rather than being assembled after an event. The ICA also suggested legislation could require the RA to form them. The new agreement is an MoU, not a statutory obligation.
The way NSW handles recovery has been under scrutiny since then. In June, the same committee published a report on the RA’s response to the May 2025 floods. It made 23 recommendations, including an urgent expansion of the “Tell Your Story Once” project, which aims to spare flood victims from recounting their experiences to agency after agency.
The ICA declared those Mid North Coast and Hunter floods an insurance catastrophe. They went on to generate about 14,500 claims and $266 million in losses, according to ICA figures.
The agreement arrives a week after severe thunderstorms brought down trees onto homes, cars and powerlines across western Sydney. As of 4 November, the ICA had not declared that event a catastrophe or significant event.
The national backdrop is heavy. Extreme weather produced $4.8 billion in insured losses across Australia in 2025, according to ICA figures released in April.
Hall’s call for other states to follow also opens a test of how far the model travels. Queensland is the most likely candidate, since its reconstruction authority served as the template for the NSW agency.
In NSW, the measure of the agreement will be whether policyholders get a useful answer sooner after the next event, and with the storm season running into February, that test may come before the new year.
