PERILS reveals initial industry loss for NSW and QLD floods

PERILS reveals initial industry loss for NSW and QLD floods | Insurance Business

PERILS reveals initial industry loss for NSW and QLD floods

The devastating floods that hit New South Wales (NSW) and Queensland (QLD) in March have resulted in AU$1,055 million initial industry loss, according to PERILS.

An extreme period of rainfall hit the East Coast of Australia from March 18 to 24, 2021 – resulting in intense river and surface water flooding. The rainfall resulted from a blocking high-pressure system in the Tasman Sea and a low-pressure system off northwest Australia, which fed large volumes of moist tropical air into eastern Australia.

PERILS, an independent organisation providing industry-wide catastrophe insurance data, collected its initial loss data from the majority of the Australian insurance market. In line with its events definition, the latest loss figure covered the property and motor hull business lines.

According to PERILS, the areas most affected were the Mid North Coast and the Hunter and Greater Sydney regions. Adjacent parts of southeast Queensland and eastern Victoria were also affected by storm and flood damage.

From March 18 to 24, the NSW coast experienced the highest recorded rainfall since national records began in 1900, with some locations along the mid-north coast of New South Wales recording 600 to 800 millimetres of rain.

The resulting damage to private property and businesses was covered to a large part by insurance. Meanwhile, losses to public infrastructure, crops, and livestock remained largely uninsured.

Darryl Pidcock, the head of PERILS Asia-Pacific, commented: “During the week ending March 24, 2021, the East Coast of Australia experienced extreme rainfall over both a wide geographic area and an extended period.

“The resulting damage from storm drain water and river flooding was considerable, especially for New South Wales, where the event represents the largest industry flood loss on record. While damage to private property was largely insured, there were cases where policyholders decided to opt-out of flood cover, reminding us of the challenges the industry still faces in offering sustainable and affordable flood risk protection in Australia.”

PERILS will release the updated estimate of the property market loss from the NSW and QLD floods on June 24, 2021 – three months after the event and date.