Flood catastrophe 'costliest weather event in Australian history'

The Insurance Council of Australia (ICA) says the February-March flood catastrophe that hit Queensland and NSW is Australia’s most expensive natural disaster.

Updated figures reveal total insured losses amounting to $5.65 billion, surpassing the cost of the previous record holder, the 1999 Sydney hailstorm.

ICA says insurers have already paid out $3.59 billion, with about 69% of the 237,470 flood claims closed.

CEO Andrew Hall says it’s “pleasing to see” that most claims have now been closed given the scale of damage, promising that “insurers are working around the clock to close out the remainder”.

The figures come as part of new data released by ICA that shows insurance costs relating to storms and floods since 2020 – that have been declared as Insurance Catastrophes or Significant Events – totalled $12.3 billion.

Mr Hall says the “very sobering” numbers show that one in 25 Australians have lodged a claim relating to extreme weather since January 2020.

“Each one of the 788,000 wild and wet weather claims lodged with insurers over the past three years represents a significant disruption to an Australian homeowner, tenant, landlord, business owner, primary producer or motor vehicle owner,” Mr Hall said.

Among the costliest events in the past three years were hailstorms in Queensland in 2020, two of which topped $1 billion in insured losses, as well as severe storms in Victoria and SA last year, which amounted to $875 million.

Floods across Tasmania, Victoria and NSW from October have insured losses of $477 million so far, while around 3600 claims have already been lodged in relation to recent floods in Central West NSW.

“While these figures show the massive impact of extreme weather events, they also show how hundreds of thousands of Australians have been helped back on their feet by their insurer,” Mr Hall said.

He says the data shows the importance of increased investment for climate resiliency, declaring that “we need to stop building homes in harms’ way”.

“We must not ignore what this data is telling us to do – invest in community-level mitigation, home retrofits, home buybacks in the most extreme cases, and better early warning systems,” Mr Hall said.