2023 Sees Record-Breaking Insurance Claims for Wild Weather Damage—Why You Should Take Action Now!

In May 2025, devastating floods struck Taree and Port Macquarie in New South Wales. The Insurance Council of Australia revealed that about 1.4 million properties across the country are at risk of flooding. Alarmingly, 225,000 homes and 73,000 businesses face a significant chance of flooding every year. In the next decade, that risk could rise to 40%. New South Wales has the highest number of properties at severe or extreme risk, totaling 171,000.

Many of these high-risk homes belong to families with lower incomes. According to industry experts, about 70% of households facing the greatest flood risk are in socio-economically disadvantaged areas, and fewer than one in four of these homes have flood insurance coverage.

Andrew Hall, the Insurance Council’s CEO, points out that climate change is making floods both more likely and more severe. He explains that traditional insurance is no longer enough for these households. The cost has skyrocketed due to the almost certain risk, meaning people might need to set aside a substantial amount annually—around $30,000 to $50,000—to repair damage from flooding.

Hall believes this isn’t a market failure but rather an evolution in how the insurance industry assesses risk. As technology improves, including the use of artificial intelligence, companies can provide more accurate pricing.

To address these rising costs, more effective flood control measures are needed, such as better levees in vulnerable towns. Hall also urges governments to halt outdated housing developments in flood-prone areas that were approved decades ago.

Experts warn that climate change is set to worsen extreme weather events. Chan from NRMA Insurance says we should anticipate more intense storms and hotter weather, increasing the risk of bushfires. The increasing population near bushland means more people are at risk.

This situation emphasizes the need for better planning and infrastructure to protect communities. As climate changes, adapting our strategies will be critical for safeguarding lives and property. For those interested in more detailed insights on climate change and environmental issues, resources like the Environmental Protection Agency can provide valuable information.

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