The Insurance Council of Australia (ICA) has welcomed the 2023-24 budget to improve emergency early warning systems.
The improvement is backed by an analysis conducted by actuarial consultancy Finity in a 2022 report for the ICA.
“With households grappling with cost-of-living pressures, reducing the physical risks to homes and communities is critical for taking pressure off insurance costs,” said ICA CEO Andrew Hall.
“We know that communities across the east coast are still recovering from the floods in 2022, which were the costliest in history, so it is welcoming to see the government continue its commitment to fund disaster resilience and measures to protect Australian communities from extreme weather.”
The ICA has also welcomed the 10-year funding to remediate high-priority flood warning infrastructure and address critical reliability risks.
The ICA said it looks forward to working with the federal government on the Hazards Insurance Partnership (HIP) to inform future investments of the Disaster Ready Fund (DRF) and outline a natural hazard risk database for Australia. However, its continues to call on the federal government to extend the DRF funding past the five-year budgeted commitment.
In its Budget submission, the ICA calls for extending the DRF funding to a 10-year rolling program to ensure that Australians receive the benefits of resilience and mitigation investment for years to come and enable governments and communities to plan for long-term projects that put downward pressure on insurance premiums.
“With claims costs from last year now hitting nearly $7 billion, much more will need to be done soon. We call on the states to also share the heavy lifting in resilience and mitigation funding,” Hall said. “Insurance is a critical safeguard against extreme weather events, and the Insurance Council is steadfast in its advocacy to see significant and ongoing investment in measures to reduce risk, protect communities, and ultimately, reduce insurance premiums for households and businesses.
“We look forward to working constructively with the federal government and other stakeholders, including regulators and the business community, to see a more resilient Australian.”
