A new report released by the Australian Business Roundtable for Disaster Resilience and Safer Communities has found that total costs linked to natural disasters in Australia are forecast to more than double in real terms per year by 2050.
The report found that disaster costs could reach as high as $39 billion by 2050, with the previous decade having seen the total economic cost of natural disasters average out at $18.2 billion per year; equivalent to 1.2% of Australia’s GDP.
The Roundtable, which counts
IAG and
Munich Re among its members, has said that all stakeholders have a role to play in ensuring communities are strengthened and well prepared, including brokers.
“Brokers play a critical role in helping to inform their clients of their risk and the appropriate insurance,” a spokesperson for IAG, a member of the Roundtable, told
Insurance Business. “The Roundtable’s report highlights the importance of collaboration and the sharing of expertise and information across all levels of government, business, the not-for-profit-sector and communities, of which brokers are an important member.”
The report, entitled
Building Resilience to Natural Disasters in our States and Territories and prepared by
Deloitte Access Economics, recommends that resilience become more mainstream and embedded within all aspects of policy and decision making. In addition, it recommends that resilience investments are prioritised by their broader economic and social benefits.
The insurance industry has long lobbied state and federal governments in support of increasing investment in mitigation and IAG’s spokesperson again noted that the Roundtable “strongly supports” the findings of the Productivity Commission, which recommended increasing mitigation funding to $200 million a year.
“However, even if this was achieved tomorrow, it would still be critical to have a framework in place to prioritise where this funding was allocated to ensure it would have the greatest impact on community safety,” the spokesperson continued.
“The Roundtable wants to work with all levels of government to co-design a framework to prioritise and assess the most effective resilience projects and locations, and to ensure that positive experiences and results are shared across state and territory boundaries, so that other governments and communities can consider adopting successful resilience building initiatives.”
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