‘Uninsurable nation’ – one in 25 Australian properties classified high-risk by 2030

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Peopke standing in front of floodwaters in Brisbane

A new Climate Council report says climate change is creating an insurability crisis in Australia due to worsening extreme weather and skyrocketing premiums.

The ‘Uninsurable Nation: Australia’s most climate-vulnerable places’ report says one in 25 properties in Australia will be classified as ‘high risk’, with annual damage costs of extreme weather rendering them effectively uninsurable by 2025.

The figures are even more alarming for at-risk electorates – 15 percent of properties in the top 10 most climate vulnerable federal electorates will be uninsurable by the end of the decade. The top 10 most climate vulnerable electorates are:

  1. Nicholls, Victoria
  2. Richmond, New South Wales
  3. Maranoa, Queensland
  4. Moncrieff, Queensland
  5. Wright, Queensland
  6. Brisbane, Queensland (pictured)
  7. Griffith, Queensland
  8. Indi, Victoria
  9. Page, New South Wales, and
  10. Hindmarsh, South Australia.

Queensland is the most at-risk state; 6.5 percent of properties there will be uninsurable by 2030. The electorate of Nicholls, in Victoria’s regional north is the number one most at-risk electorate in the nation, with 26.5 percent of properties to be classified ‘high risk’ by 2030.

A further nine percent of properties nationwide risk becoming medium risk, and potentially underinsured by the end of the decade.

Riverine flooding is the most costly disaster. Of the properties considered uninsurable by 2030, 80 percent of the expected threat is due to riverine flooding.

Bushfire and surface water flooding (also known as flash flooding) are the other two main threats.

The Federal Government has, over the past eight years, failed to meaningfully address the climate crisis or prepare Australians for extreme weather, says the report. Decisions over the next term of government are critical, and will influence the outcomes of the climate crisis for generations.

To avert disaster and the insurance crisis, Climate Council’s report recommends:

  1. Enable swift and deep emissions reduction across the whole of the Australian economy. This includes cutting emissions to 75 percent lower than 2005 levels by 2030 and net zero by 2035.
  2. Eliminate fossil fuel subsidies. “In 2021-’22, Australian Federal and state governments provided a total of $11.6 billion worth of spending and tax breaks to assist fossil fuel industries – 56 times the budget of the National Recovery and Resilience Agency. This is completely at odds with addressing the risks from climate change and extreme weather,” says the report.
  3. Prioritise investment in resilience. Investment in resilience provides a “triple dividend” of avoided loss and suffering, reduced disaster costs and potential economic and social benefits. Increased public investment in resilience and innovative planning pathways, based on independent, data driven research, that focuses on the most vulnerable communities, is required.
  4. Account for climate risks in land use planning. Measures should be put in place to prevent new buildings and infrastructure being planned in areas that are, or will be, exposed to climate crisis hazards..
  5. Improve building standards and compliance. Climate Council recommends the National Construction Code should be updated to ensure that buildings are able to better withstand risks posed by changing climate and weather events, and that this should be supported by stronger compliance and enforcement.
  6. Support communities to build back better. Towns and communities must be rebuilt, where possible, in a resilient way. In high-risk areas, this may even mean not rebuilding at all. “Managed relocations must be discussed as an option for some of the most vulnerable and exposed communities,” says the report.

Photo by Valley Guide on Unsplash.

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