Millions of Aussie properties are facing an insurance nightmare with new analysis showing they are at growing risk of natural disasters ranging from bushfires to floods and cyclones.
Regional NSW areas facing floods and fires made it the nation’s most at risk state, but the shock data has listed Queensland’s capital Brisbane as facing the worst dangers in the country from coastal inundation between now and 2050.
The new Climate Council data released in the At Our Front Door report shows almost nowhere in the nation is safe, with a section of Victoria the country’s second most at risk area due to flood concerns impacting more than 26,000 properties, and a segment of South Australia ranked third due to bushfire danger and high winds.
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The research shows that nationwide, 2.2 million properties or about one in 10 have been ranked as at least at moderate risk of climate hazards, indicating they are likely to be paying heightened insurance costs.
Within that number, about 652,000 are classed as high risk and either uninsurable or facing situations where their insurer will exclude coverage for some of the most pressing risks including coastal erosion and high winds.
It has surged from about 572,000 in 1990, and without urgent climate action is forecast to hit 746,000 by 2050, and to effectively double to 1.3 million properties by 2100.
Climate Council economics specialist Nicki Hutley said there were also now 72,000 homes across 86 suburbs nationwide that were now at “critical risk”, with at least 80 per cent of properties virtually uninsurable due to the risk of climate related disasters.
Australia’s most at risk electorates according to a new Climate Council report.
“Ultimately there will be areas where we will need to move people,” Ms Hutley said.
In Shepparton, Victoria, 16,775 homes have been classed as in high risk — about 88.4 per cent of the total.
Areas with upwards of 90 per cent of homes uninsurable include Old Gate in South Australia, as well as Bourke and Bucketty in NSW.
The analysis, completed in partnership with Climate Valuation has ranked NSW as the nation’s most at risk state — with half of the nation’s 10 most uninsurable electorates located there.
Climate Valuation founder Karl Mallon said the research had covered 15 million commercial and residential properties nationwide.
Mr Mallon said the government would need to consider urgent interventions including flood levies and buy backs in some of the most at risk communities.
THE MOST AT RISK ELECTORATES BY STATE
| NSW | VIC | QLD | WA | TAS | NT | ACT | SA |
| Richmond | Nicholls | Brisbane | Bullwinkel | Bass | Lingiari | Canberra | Mayo |
| Page | Indi | Maranoa | O’Connor | Lyons | Solomon | Bean | Barker |
| Robertson | Melbourne | Moncrieff | Tangney | Braddon | Fenner | Hindmarsh | |
| Dobell | Mallee | Griffith | Canning | Franklin | Boothby | ||
| Hunter | Macnamara | Kennedy | Durack | Clark | Grey |
NSW’s seat of Richmond was the nation’s most at risk with 31,564 properties at high risk of flooding or bushfire — about 29 per cent of the total.
The Victorian seat of Nichols was second, with 26,055 properties at high risk, or one in every four homes. The region’s key risks are flooding and damaging winds.
South Australia’s Mayo electorate was next with 20,170 homes likely to be uninsurable for a mix of bushfire, flooding and high winds. It works out to about 17.5 per cent of the total.
But one of the biggest shocks was the Brisbane electorate in Queensland being ranked fourth nationwide, with 18,978 homes (12.75 per cent of the area’s full number of homes) designated as at high risk of flooding from the Brisbane River and its tributaries and even concerns over coastal inundation.
Melbourne also made the list of Victoria’s five most at risk electorates with 6887 homes at high risk and more than 47,000 with a medium risk of natural disasters.
NSW is Australia’s most at risk state according to the Climate Council and Climate Valuation research.
“This is a giant chunk of risk coming to houses all across the country and we are not dealing with it properly,” Ms Hutley said.
Formerly a senior partner at Deloitte Access Economics, Ms Hutley said setting and achieving targets to address climate change was the most meaningful thing the nation could do.
However, she added nationally consistent planning guidelines for bushfire prone areas would be beneficial, while establishing design requirements for flood and wind-damage danger zones would also be important in the years ahead.
“Considering the risks and what Australia has been through in the past five years, you would think Australia would be more on the front foot,” she said.
“There’s $13.5bn in the budget for recovery. You’d think they would have some funding for prevention.”
A substantive chunk of Queensland around Brisbane is facing high risk scenarios for large numbers of properties.
Aussie house prices are also becoming a factor.
Ms Hutley said NSW’s high numbers of homes in at risk areas likely reflected home prices in the state’s major cities squeezing people out to less safe regions.
She added that with many of the electorates with the greatest risks also home to generally less well off Australians, many in those areas were unlikely to be able to afford significant insurance premium rises.
Soaring building costs are also adding to the issue, as insurers factor in higher replacement costs.
NUMBER OF ADDRESSES AT HIGH RISK BY STATE
|
YEAR |
NSW | VIC | QLD | WA | TAS | NT | ACT | SA | Other |
| 1990 | 222,318 | 92,873 | 159,297 | 37,624 | 5753 | 2913 | 3493 | 47,867 | 0 |
| 2025 | 263,587 | 101,296 | 167,757 | 48,264 | 6527 | 3109 | 3543 | 58,339 | 2 |
| 2050 | 304,372 | 118,554 | 183,783 | 58,581 | 7600 | 3270 | 3579 | 66,344 | 102 |
| 2100 | 440,917 | 262,709 | 305,314 | 199,083 | 11,865 | 4278 | 3580 | 88,690 | 409 |
Separate Proptrack data shows some of the nation’s most at risk electorates are already taking home value hits.
In the most at risk electorate in the country, NSW’s seat of Richmond, the $1.22m median house price is currently $30,000 (2.4 per cent) below where it was before Australia last went to the polls in 2022.
They’re also down $10,000 at $1.19m in the Robertson electorate over the past three years.
And in the seat of Page, the nation’s fifth most at risk, unit prices are basically flat in the same timeline with a less than $1300 (0.2 per cent) increase to $520,000.
Proptrack senior economist Eleanor Creagh said the data showed “climate hazard events” had left lasting marks on housing markets around Australia — but it was not yet clear if rising insurance premiums would also hurt home prices.
“In some of these regions, median prices haven’t recovered in several years,” she said.
“That would include heightened awareness and increased insurance premiums, and other things.
“But the insurance side, as it related directly to home values … that would take a bit of modelling.”
The Climate Council map shows large chunks of Australia already face significant natural disaster risks.
Victoria’s most at risk electorate surrounds the Shepparton region, while Melbourne’s CBD also has large numbers of homes at high risk.
The economist noted that there were some communities that had bounced back more quickly, and that even where there were known risks many people would likely continue to see owning a home there as worthwhile for lifestyle reasons.
Ms Creagh added that there was a “huge amount of work to be done in the policy space around standardising climate risk reporting” and that adapting building design and zoning in some areas would become increasingly important for insurance and home values.
Clearer and more standardised reporting in this space would also make it easier for prospective homebuyers to understand risks before purchasing a home, with the economist noting it was probable people would like to factor it into their plans but were currently unable to.
The Insurance Council of Australia estimates that across the past five years extreme weather unsurance costs have totalled at $4.5bn a year — increasing 70 per cent from before the pandemic.
While much of South Australia has fairly low risk, concentrated population centres in the south east have subtantial numbers of homes at risk.
They are projecting he figure to hit $35bn by 2050, with flood likely to drive the majority of those costs with about 1.36 million Aussie properties believed to face some level of innundation risk.
A spokesperson for ICA said they were calling for a $30.15bn flood defence fund for the next decate that would improve levees and dams as well as upgrading properties that are most likely to be impacted.
It also includes a push to spend $10bn buying back the most at risk properties.
To reduce insurance costs they have also suggested state governments could remove taxes on insurance, which adds anywhere from 10-40 per cent around the nation.
They added that some insurers are offering discounts of up to 60 per cent for homeowners who take steps to make their property more resilient to bushfire.
Australia’s east coast is home to some of the greatest natural disaster risks to property.
The Climate Council and Climate Valuation analysis used maximum-to-date value-at-risk methodology to assess homes, essentially calculating the highest possible value loss a property could sustain due to extreme weather events.
The research excluded towns with populations below 100, meaning figures could be substantively higher.
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