More than half a million homes will be uninsurable by 2030 due to Australia’s rising risk of extreme weather and climate change, experts say.
Hundreds of thousands of Australians are facing soaring premiums after recent years have seen the country battered by bushfires, floods, and severe winds.
But the Climate Council says the issue is only set to get worse.
According to their data, one in 25 properties will be effectively uninsurable within the next eight years.
Antoinette, from Victoria, typically pays $3293 annually for home insurance, but when she received her renewal notice last month, the price jumped to $14,206.
Climate experts say more than half a million homes will be uninsurable by 2030 as the risk of severe weather events in Australia continues to rise. Pictured: Floods in Lismore, in northern NSW, in March
Antoinette (pictured) has witnessed her insurance premium hike by more than $10,000 despite never making a claim
She has never made a claim and has lived in the same home for 20 years.
‘I thought it was a scam actually,’ she told A Current Affair.
‘There was no information on it that it was going to happen.’
Kirsten’s Queensland home has seen two major floods. She currently pays about $4000 a year for insurance, but is now bracing for her premium to rise two or threefold.
‘This house sits in about a 1 in 75-year flood risk. We have had three floods in 50 years. If we dropped flood insurance to save $8000 a year and there is another flood in less than ten years, we would have about $100,000 of repairs to do,’ she said.
In Queensland, where there is the biggest number of high-risk electorates, 6.5 per cent or 193,232 properties are forecast to be uninsurable by 2030.
The same applies to 3.3 per cent (148,546) homes in NSW, 3.2 per cent (35,285) in SA, 2.6 per cent (95,845) in VIC, 2.5 per cent (2783) in NT, 2.4 per cent (35,277) in WA, 1.9 per cent (6689) in TAS, and 1.3 per cent (3071) in the ACT.
Chief Operating Officer of The Insurance Council of Australia Kylie McFarlane said the council has incurred over 395,000 claims in the last year – or around 6.5 billion worth of claims.
In March, insurance premiums rose about 2.3 per cent after a series of wild weather events lashed the country over the past 12 months.
‘Insurance is a pool, so effectively it is the premium of many who pay for claims of a few. And the pool needs to be sufficient to pay those claims over time,’ Ms McFarlane said.
Kylie McFarlane, Chief Operating Officer of The Insurance Council of Australia, said around 6.5 billion worth of insurance claims have been lodged within the past 12 months
In recent years, Australia has been battered by a series of wild weather events, including bushfires, floods, and extreme winds. Pictured is a shot taken during the Black Summer Bushfires of 2019-2020
And it is expected there will be more weather to come.
Meteorologist Ashleigh Lange from Weather Zone said a La Nina like state is still lingering off Australia’s coast, giving rise to the possibility that the wet weather event could redevelop again this year over spring or summer.
CEO of Climate Valuation Dr Karl Mallon said the analysis looked at the impacts of climate hazards on 14 million Australian homes to assess the weather risks of homes over the next decade and beyond.
Dr Mallon said it was ‘striking’ how the number of affected properties grows under higher emissions scenarios.
Climate Council CEO Amanda McKenzie said Australians are paying the price for Scott Morrison’s Government ‘failing to meaningfully tackle climate change’.
‘Climate change is playing out in real time here and many Australians now find it impossible to insure their homes and businesses,’ she said.
‘Pollution from coal, oil and gas must begin to plummet and we must scale up our renewable power so it meets the needs of all sectors of our economy.’
The top 10 most at-risk electorates for uninsurable properties by 2030
1.Nicholls, Victoria: 27% or 25,801 properties
2.Richmond, New South Wales: 20% or 22,274 properties
3.Maranoa, Queensland: 15% or 9,551 properties
4.Moncrieff, Queensland: 14% or 18,032 properties
5.Wright, Queensland: 14% or 12,140 properties
6.Brisbane, Queensland: 13% or 19,355 properties
7.Griffith, Queensland: 13% or 14,812 properties
8.Indi, Victoria: 11% or 11,215 properties
9.Page, New South Wales: 11% or 11,691 properties
10. Hindmarsh, South Australia: 11% or 10,775 properties
Is YOUR home at risk? The 10 areas in Australia that are likely to become IMPOSSIBLE to insure by 2030 – with up to 90 per cent of properties unable to be protected in one flood-prone city alone
By Stephen Johnson, Economics Reporter for Daily Mail Australia
Up to 90 per cent of homes in some parts of Australia are set to become uninsurable because of catastrophic flooding, an environmental group has warned.
The Climate Council has named the 10 areas across the nation most at risk of natural disasters including floods and bushfires, with five of them in Queensland.
A section of northern Victoria that is part of the Murray-Darling Basin was deemed the most vulnerable part of the country for flooding.
The Climate Council predicted 26.5 per cent, or more than one in four homes in the electorate of Nicholls – which covers the major regional centres of Shepparton and Echuca – would be uninsurable by 2030.
Most worryingly, a huge 90 per cent of homes in Shepparton, which sits on the Goulburn River, were expected to be impossible to insure within eight years because of the flood risk.
The Climate Council has named 10 areas of Australia, by federal electorates, most at risk of natural disasters. Shepparton hasn’t had recurring floods recently like Lismore and Brisbane, with its last major inundation in 2010 (pictured) but up to 90 per cent of homes could be uninsurable by 2030
Shepparton hasn’t had recurring floods such as those in Lismore and Brisbane, with its last major inundation in 2010.
But Nicki Hutley, an economist with the Climate Council who co-authored the report, said it was Australia’s most at-risk place for flooding based on forecasts for heavy rainfall in the area which is flat.
‘It’s all about where we’ve built,’ she told Daily Mail Australia.
‘Shepparton has yet to have the types of floods that we have seen elsewhere but this is all about risk.
‘This all comes down to the level of increased rainfall that is forecast that will affect those river systems.’
Nicki Hutley, an economist with the Climate Council who co-authored the report, said Shepparton was Australia’s most at-risk place for flooding based on forecasts for heavy rainfall in an area that is flat
The Nicholls electorate, previously known as Murray, had 25,801 properties regarded as high risk, putting it well ahead of the northern NSW electorate of Richmond, covering Ballina and Byron Bay, where 22,274 homes are predicted to be in danger.
Should rising global temperatures bring more frequent and devastating floods, potential home buyers would baulk at paying $30,000 a year in flood insurance, which Ms Hutley said would significantly reduce the value of homes.
‘Whether they are worth nothing, it becomes a question of what the increase in the insurance premium is going to be,’ Ms Hutley said.
‘In some areas, the risk is much higher.
‘There’s a big difference if you’re going to pay $3,000 a year in insurance versus $30,000 – if it’s $30,000 then somebody who’s going to buy that property is either going to expect to buy it for almost nothing – to take account of the fact that they can’t insure the property.
‘If it’s a much lower rate of insurance, it might bring down the price of the property.
‘If someone buys a house, if it’s going to cost them an extra $5,000 a year for 10 years, does it knock it off by $50,000?’
Southeast Queensland had five spots in the shortlist of the 10 worst-affected federal electorates, with two of them in Brisbane, one on the Gold Coast and two further inland.
The Southern Down region southwest of Brisbane was one of the five federal electorates in Queensland most at risk of natural disasters
Northern NSW had two spots, and Adelaide had one place on the danger list.
The northern Victorian electorate of Indi, which covers Wangaratta, had 10.7 per cent of homes regarded as possibly uninsurable because of flooding.
Recurring flooding in Brisbane this year helped the Greens win the seats of Brisbane and Griffith for the first time ever at the May 21 election, with both those electorates considered most vulnerable to the effects of climate change.
In Brisbane, 12.5 per cent of homes were considered likely to be uninsurable by 2030, with the electorate covering the northern side of the Brisbane River.
In the city’s south side, 11.4 per cent of homes were considered to be high risk because of riverine flooding.
A similar proportion, or 11.9 per cent of homes in the Moncrieff electorate on the Gold Coast, which covers Surfers Paradise, were also regarded as being potentially uninsurable.
On the other side of the Queensland border, the Richmond electorate covering Ballina and Byron Bay was particularly at risk, with 14.5 per cent of homes deemed uninsurable by 2030 because of regular flooding.
On the other side of the Queensland border, the Labor-held seat of Richmond covering Ballina and Byron Bay (pictured) was particularly vulnerable, with 14.5 per cent of homes deemed uninsurable by 2030 because of the flood risk
This was significantly higher than the neighbouring Page electorate where 5.4 per cent of homes were deemed insurable by 2030 even though it is home to the badly flood-hit city of Lismore.
To the north, back in Queensland, the Maronoa electorate covering the Southern Downs area and the city of Warwick had 13.9 per cent of homes considered uninsurable due to flooding.
The Wright electorate was also the list with nine per cent of homes potentially impossible to insure because of bushfire risk.
Adelaide rounded out the top 10 list with the Labor seat of Hindmarsh deemed to have 9.5 per cent of homes with a high flood risk.
Ms Hutley said while bushfires destroyed homes, flooding was typically more devastating to more properties.
‘Ultimately, what you can see is the most expensive risk comes from flooding – it tends to be closer, unlike fire which tends to happen often in areas that are uninhabited as devastating as it is,’ she said.
The Climate Council has named 10 areas of Australia, by federal electorates, most at risk of natural disasters, with five of them in Queensland