Antinuclear

Australian news, and some related international items

Cost of insurance becoming unmanageable in Australia, due to climate change?

Could climate change make it harder to get insurance in Australia? ABC News The Signal , By Ange Lavoipierre and Stephen Smiley for The Signal, 6 Feb 19,  At the moment, Townsville is more or less underwater and large parts of Tasmania are on fire.

Key points:

  • There were anecdotal reports of premiums reaching $30,000 after the 2017 Lismore floods
  • There is a serious risk some places could become too disaster-prone to insure, according to an expert
  • Taxpayers could end up footing the bill

Summer in Australia has always been extreme, but some corners of the country are experiencing climate-driven disasters that are worse than ever — and more of them every year.

Those stories are told in extraordinary detail as they unfold, but once the world looks away, there’s the question of who’ll pay the bill.

So with fires, floods and crazy weather becoming more frequent and severe, is Australia on its way to being uninsurable?

The clean-up can take years and cost millions…….

Could we become too disaster-prone to insure?

The director of the Climate and Energy Program at the Australia Institute, Richie Merzian, says it’s a very real risk.

“We will get to a certain point, somewhere between say 3 degrees or 4 degrees above pre-industrial levels, and a world like that will see situations where cities, entire coastlines, do become uninsurable,” he said.

Mr Merzian said in that case “the basic safety net that’s provided by the private sector just becomes too prohibitively expensive”.

He said in that instance, the burden will fall back on the taxpayer.

“The Government is always the insurer of last resort and then you see these odd situations where everyone will have to pay to keep these towns operating,” Mr Merzian said.

“And we saw that with the Queensland flood levy, where the damages were so big the insurance industry couldn’t possibly cover it.”.

So can it be avoided?

Mr Merzian said it was possible, in the immediate future, to manage the risks to insurers in flood and fire-prone areas.

“Some insurers have basically decided to leave certain markets,” he said.

“Ideally the insurance [companies] that do want to stay in there need to work with the governments to make that happen.

“And that’s where you see more money and effort put into mapping the risks, improving zoning, building better codes and better safety measures.”

Mr Merzian warned that the difficult discussion about whether or not it was even appropriate to rebuild in some disaster-prone areas was not happening in enough places.

“There’s $88 billion at risk in terms of damage from coastal erosion in Australia … but no local council wants to go and tell people who have million-dollar beach houses, ‘you shouldn’t have built here’,” he said. https://www.abc.net.au/news/2019-02-06/could-climate-change-make-australia-uninsurable/10783490

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February 7, 2019 - Posted by | AUSTRALIA - NATIONAL, business, climate change - global warming

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