Natural disasters have been hitting Australia more frequently and severely over the years, compelling the Insurance Council of Australia (ICA) to call on state and federal governments to enact policy changes that will protect Australians.
The ICA’s “Insurance Catastrophe Resilience Report: 2020-21” provides a data-driven overview across five events that ICA declared insurance catastrophes between October 2020 and June 2021, including south-east Queensland’s Halloween hailstorm, the New South Wales (NSW) storms and flooding in March, and the tropical cyclone in Western Australia (WA).
The report also provides an update on community recovery from the Black Summer from 2019 to 2020, which resulted in insurance payouts of nearly $5.5 billion across four natural disasters, including devastating bushfires.
As natural disasters become more devastating, the ICA has suggested six policy changes to protect Australians from the impacts of future events:
- Investing more in resilience, particularly at a state level;
- Improving building quality and standards to provide better protection from extreme weather events;
- Developing better land-use planning to ensure that homes are not built in harms’ way;
- Removing state taxes on insurance to improve the level and extent of cover;
- Applying a national approach to the movement of essential recovery personnel across state borders to avoid delays to repairs and rebuilds; and
- Implementing coordinated disaster clean-up after an event to allow rebuilding and recovery to commence as soon as possible.
“Insurers are seeking a better streamlined process to facilitate border restrictions to enable us to move claims assessors, disaster recovery specialists, builders, and tradies in a COVID-safe way between and within states and territories to undertake essential repairs and rebuilds,” said ICA CEO Andrew Hall.
“We appreciate the need for restrictions to mitigate health risks. However, these must be balanced against the needs of those requiring urgent repairs to their properties that will enable them to pick up their lives and move on. Families can’t wait weeks for state authorities to consider exemptions to be processed to get extra help to impacted communities.”
The National Insurance Brokers Association (NIBA) has welcomed the ICA’s new report as natural disasters usually result in a surge of claims beyond the capacity of local workforces. In addition, limited access to interstate insurance, loss assessing and trades personnel due to COVID-19 restrictions, and border closures, could cause significant challenges for insurers, policyholders, and brokers who need to assist clients with their claims.
“Insurance brokers are essential in helping their clients navigate preparations for, and recovery from, natural disasters and major weather events. They are on the front line and have seen first-hand the challenges presented by state border restrictions as they help their clients navigate the recovery from natural disasters,” said NIBA CEO Dallas Booth.
“Insurance brokers serve their local communities and regions, regardless of the existence of state and territory borders. NIBA strongly supports the ICA call for a national approach in this area as it will not only lessen the impact of future natural disasters but also enable insurance brokers to be on the ground supporting their clients through the recovery process.”