The role of insurance in protecting against weather emergency risks

Many Australians may have noticed the steady increase in extreme weather events nationwide.

Floods, storms, and bushfires all threaten the livelihoods of hard-working Australians, ranging from beloved homes to family lives.

That is why it is crucial to ensure that you have the necessary insurance to protect you and your family against weather risks.

It's been a summer of extremes in Australia, with weather records broken in almost every state.

NRMA Insurance received 19,600 claims for wild weather damage to homes and vehicles nationally.

This is the highest number of home claims in any season in almost two years.

Digging beneath this, we see that storms and hail were behind more than 85% of claims.

These are the weather events that can arise with little warning and result in incredible destruction in just a few minutes, but there are also opportunities to plan ahead. https://www.nrma.com.au/wild-weather-tracker

In summer, Ex-Tropical Cyclone Jasper impacted regions from Cape York Peninsula to Townsville, while Christmas and New Year storms ravaged regions of Queensland, New South Wales and Victoria.

Western Australia also experienced its share of wild weather, as Perth sweltered through its third warmest summer on record, which fuelled bushfires across the state.

Just as multiple different types of weather events arise in Australia's diverse climate, there are various types of weather-related insurance coverage.

Deciding which type is best for you and your home is entirely dependent on what kind of events your area is at risk of facing, as well as what you wish to protect most.

With the comprehensive coverage of weather-related insurance, you can ensure a swift and effective recovery after any weather event.

No matter the extent of damage, having a trustworthy insurer on your side can make the process easier for you.

For those who have a vested interest in protecting their homes against multiple weather events, but live in an area with low probability, conventional weather insurance is a good choice.

This insurance protects you against any losses or damages that occur from adverse, measurable weather conditions.

The premiums are determined by the likelihood of an event occurring and the amount of potential loss collected.

If you are living in any area that is prone to a particular weather emergency, such as bushfires, storms, or floods, choosing insurance tailored to such an event can be beneficial.

Fire insurance will recuperate losses caused not just by household incidents, but also damages caused by natural bushfires to buildings and belongings.

Flood and storm-related insurance will do much the same, with coverage applying to entire households, cars, and personal property.

Meanwhile, most home or homeowners' insurance defines coverage to apply to costs required to repair or replace aspects of your home and its belongings.

This can stipulate damages caused by weather events, but its more generalised approach means that it does not afford the unique benefits associated with fire or flood insurance.

However, those who have invested significant time and money into their homes may prefer this type of insurance as coverage is held to the same standard as the original furnishings or structure of the home.

To help determine which insurance product is best for you and your personal needs, it is important to assess the weather risks around your home.

By knowing what kind of weather events may occur at your location, you can single out what kind of damages you need to be insured against.

Associating with a provider like NRMA Insurance means that you are guaranteed excellent customer service from experts who can guide you towards the right insurance product.

Finding an insurer that both places you first, while also offering expert advice and information on your community and its weather risks, can significantly raise your chances at choosing the best product possible.

However, you can also assess personal or property risks in relation to different weather conditions by:

The Climate Risk Map of Australia is one of the more comprehensive tools for determining whether your location will face personal and property risks.

This includes the level of risk you could face and what kind of weather events are most likely to occur.

Seeking out resources and tools like this can help in your assessment of risks.

Alternatively, you can speak directly to an insurer through a consultation to determine appropriate coverage levels.

Bringing in public data on the risks your location is likely to face from weather events can help narrow down the kind of coverage you need.

Supplying the value of your personal belongings and property is also beneficial, especially if you have heirlooms or objects of great value, both monetarily and personally.

Being open and honest with your insurer is one of the best ways to guarantee your insurance needs are met.

Insurance plays a key role in post-weather event recovery efforts, regardless of the kind of damage caused or the weather event that occurred.

This is because insurance often signals the beginning of recovery and alleviates many Australians' concerns in the wake of disasters and the damages they cause.

Having insurance before a weather event damages your home or personal belongings can be a great stress reliever for many.

Insurance acts both as a safety net and a guarantee that you can begin to recover monetarily following a disaster.

In the chaos and strife that follows a weather event, knowing you are covered and have professional aid to begin recovering can reduce the chances of developing anxiety, stress, or bouts of depression.

Those living in areas prone to certain weather events have been known to develop post-traumatic stress disorders due to the constant damage to their livelihoods.

Hypervigilance is also common in these communities, as evacuation may be required at any moment.

Insurance can alleviate these worries and allow you to find more appropriate housing, with the reparations provided by your insurance helping to fund this.

Starting over may be a big change, but insurance can help make this recovery process smoother.

With the monetary assistance provided by insurance, households are more efficient in their recovery process.

Not only does this personally aid in the restoration of your livelihood, but it also aids the community.

Insurance payouts not only reduce the initial effect of a weather event, they also support the economic recovery of communities in the long term.

Returning to the norm is more likely to occur and at a faster rate with the support of insurance.

While insurance has a significant history of providing a helping hand to weather event recovery efforts, especially when supported by technological developments in digital data, climate change itself has begun to impact its policies.

The increasing frequency of severe weather events and the sheer magnitude of these events are causing raises in insurance premiums and overall costs.

High-risk areas across Australia, such as the flood-prone area of Lismore, New South Wales, or key bushfire-prone suburbs in the northern regions, are finding their premiums steadily increasing.

Residents have to pay out more insurance coverage each year as insurers work harder to cover constant property and personal damages.

In fact, high-risk areas have seen an increase of 50% in their insurance premiums in the last year, making it difficult for many to continue utilising insurance coverage.

With many finding it difficult to find affordable insurance coverage for their homes, there becomes an increasing risk that homes remain damaged due to a lack of monetary support.

This puts many families at risk, especially vulnerable populations like low-income households, children, or seniors.

Some may find it too much work to remain in these homes if they are at constant risk of weather damage, making it likely that some Australian suburbs may see a mass exodus of residents in the future.

This will cripple local economies and communities, possibly causing the abandonment of long-standing communities.

These risks, amongst others, make the need for climate risk insurance more crucial than ever.

This new angle for insurers to acknowledge climate change will help stabilise the availability and affordability of insurance once more.

Insurance councils and other associated organisations are formulating new plans to make properties more resilient against weather events caused by climate change, mitigating damages and the need for constant insurance payouts.

With this new angle, communities can stand resilient against floods, storms, bushfires, and other weather events without paying ridiculous amounts for insurance.

Insurance is just one facet of a broader weather preparedness plan.

While it has become evident that insurance is required for communities vulnerable to weather events, other methods can help you remain resilient.

Looking into preparation plans such as creating emergency kits, evacuation plans, or a more fortified household can mitigate the risks of severe weather conditions.

Reach out to your community to see if there are any available weather event risk workshops or seminars.

You can also browse the online resources publicly available to guide Australian residents in preparing for any weather emergencies.

While insurance is commonly highlighted as a necessary tool in protecting yourself against weather risks, there is so much more you can do to begin preparing.

This information is of a general nature only and should not be regarded as specific to any particular situation. Readers are encouraged to seek appropriate professional advice based on their personal circumstances.