IAG applauds NSW government's 2024-25 Budget for disaster resilience

Insurance Australia Group (IAG) has shown its support for the New South Wales government’s 2024-25 Budget.

The new budget continues the state’s efforts to aid communities affected by severe weather and natural disasters in building resilience.

Where will the NSW government allocate its 2024-25 Budget?

The NSW government’s four-year, $5.7 billion package – including contributions from the federal government – allocates funds as follows:

• $3.3 billion for repairing roads damaged by major floods
• $632.4 million for constructing new, safe housing in the Northern Rivers and Central West regions, which includes $525 million for voluntary buybacks, house raisings, repairs, and retrofits through the Resilient Homes Program
• $303.5 million for repairing, rebuilding, and improving critical infrastructure resilience

IAG welcomes budget

IAG managing director and CEO Nick Hawkins said investing in natural disaster resilience measures will benefit people living in areas at high-risk of severe weather.

“The NSW government’s significant funding announced will continue to help communities recover from multiple years of devastating floods and help them to become more resilient,” he said. “Investing in resilience measures such as voluntary home buybacks and planned relocation, house raising, and retrofits will help improve the safety of people living in areas at high-risk of severe weather, and ensure they’re better protected into the future.”

However, the insurance giant continues to call for sustained investment in disaster mitigation initiatives, enhanced land use planning, and stronger building codes to better protect people and communities from severe weather events.

The Insurance Council of Australia (ICA) also commended the NSW government’s 2024-25 Budget, emphasising that the allocation for resilience efforts could improve insurance affordability for communities.

Australian homes at risk from natural disasters

The release of the NSW government’s 2024-25 Budget brings to light a recent study by Australian property marketplace Domain, which found that nearly half of all Australian homes are at risk from natural disasters, driving up insurance premiums.

The research looked at the impact of climate change-induced extreme weather events, including bushfires, floods, and coastal erosion, affecting millions of homes across Australia.

According to the report, about 5.6 million homes, or nearly half of all properties, are susceptible to bushfires, with a total value estimated at $4.66 trillion.

Key findings include the following:

• Approximately 953,000 homes, or 8.1% of all properties, are at risk of flooding, with an estimated value of $768.5 billion
• About 160,000 homes are within 150 meters of the coastline, with one in 10 at risk of coastal erosion, amounting to $26.41 billion in property value nationwide