Storms trigger $25 million damages bill
Storms that ravaged the north coast of NSW and southern areas of the Gold Coast last week could land the insurance industry with a bill of up to $6 million, according to the Insurance Disaster and Response Organisation (IDRO).
Waters rose to more than 10 metres in some areas of northern NSW, and more than 3000 Lismore residents were forced to evacuate their homes.
The storms in Queensland didn't stop for 36 hours, flooding just about every Gold Coast suburb. The deluge left more than 26,000 residents in south-east Queensland without power and forced the closure of the Gold Coast Airport.
While there's been widespread flooding of some areas, IDRO's Queensland Co-ordinator Graham Jones told Sunrise Exchange News the "vast majority of claims from the Gold Coast will be met under policy conditions".
He says insurers have already received hundreds of claims, and more will come over the next few days when people have a proper chance to gauge the full extent of the damage.
"The worst hit area has been the southern part of the Gold Coast, but there has been widespread damage, including water damage to cars and houses, overflowing drains, flash flooding and damaged roofs," he said.
Climate change a major issue, say insurers
Damage costs could increase by as much as two-thirds by the end of the century if climate change continues to affect the intensity of extreme storms, according to the Association of British Insurers (ABI).
A new ABI report looks at the costs of extreme storms such as hurricanes, typhoons, and windstorms in the major insurance markets of the US, Japan, and Europe, and says annual insured and uninsured losses from such storms could reach $36 billion by 2080.
The report says an additional $101 billion could be needed to cover the gap between extreme and average losses resulting from tropical cyclones in the US and Japan, while higher capital costs combined with greater annual losses from windstorms alone could result in premium increases of around 60% in these markets.
ABI Director of General Insurance Nick Starling says many of the potential costs described in the report could be avoided by taking action now, and governments should be taking into account the financial ramifications of climate change.
"The most extreme storms could become even more destructive, leading to losses greater than we have seen before," he said. "Insurance markets could become more volatile, as the costs of capital required to cover such events increase."
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