**Title: Australia Faces High Economic Losses from Extreme Weather**

Australia ranks second only to the United States for economic losses due to extreme weather events over the past 45 years. According to the 2024-25 Insurance Catastrophe Resilience Report, losses from floods, bushfires, and storms have increased every decade since 1980 when adjusted for inflation. The National Climate Risk Assessment predicts that these losses will continue to rise as global warming progresses.

Insurance Council CEO Andrew Hall emphasized the importance of public perception regarding Australia’s insurance industry, which relies heavily on international capital markets. This reliance affects premium pricing. Hall noted, "We’ve got a number of populations living in high-risk zones, geographically exposed to extreme weather events, and those populations are growing."

The report highlights that this year alone, extreme weather events have resulted in nearly $2 billion in insured losses. This includes significant costs from the North Queensland floods, ex-tropical Cyclone Alfred, and floods in the Mid-North Coast and Hunter regions. Hall pointed out that inflation is increasing rebuilding costs, while the frequency of extreme weather events is also on the rise.

From 1980 to 2020, Australia consistently ranked second to the U.S. for per capita economic and insured losses among developed nations. However, in the past five years, it fell to third place, overtaken by losses from the 2023 Auckland floods and Cyclone Gabrielle in New Zealand. This data comes from Munich Re’s NatCatSERVICE global database.

Hall explained that the U.S. experiences higher losses partly due to lower building standards and federal bailouts that do not discourage development in flood-prone areas. He stated, "We’ve got the opportunity to learn from those mistakes."

To address these challenges, Hall called for increased investment in community-level resilience projects, such as flood levees designed to withstand predicted maximum flood heights. He welcomed the National Adaptation Plan released alongside the Climate Risk Assessment but argued that more action is needed. "If we’re serious about living in a changed climate future, we’ve got to have homes that are resilient and durable for the issues they’ll face after they’ve been built for the next 50 to 100 years, the average life of a normal home," he said.

The focus on climate resilience is growing among philanthropists and corporate grant programs. Recently, NRMA Insurance announced its Help Fund, which partners with the start-up program Climate Salad to support local projects aimed at tackling climate challenges. These initiatives aim to reduce risks, strengthen community resilience, and enhance adaptation to extreme weather events.

As Australia continues to face the impacts of climate change, the insurance industry is under pressure to adapt and find solutions that ensure affordability and accessibility for all residents. The ongoing rise in extreme weather events underscores the urgent need for effective strategies to mitigate risks and protect vulnerable communities.