About flood insurance

1. Check the details of your insurance policy to understand what your premiums are paying for. Some policies may state that you are covered for flood damage but check the fine print and definitions. E.g., your cover may apply to a particular form of flooding, for example, storm flooding rather than riverine flooding. 

2. Consider engaging an insurance broker. This can be a good way to decode your insurance policy and make sure that you understand what you are covered for. Insurance brokers might also suggest alternative insurance products, should yours be unsuitable.

If insurance is not affordable or not available, then then your household or body corporate can:

1. Insure yourself. ‘Self-insurers’ put money aside, often in a designated bank account, to cover themselves in the case of a disaster. This choice is becoming increasingly popular due to skyrocketing insurance premiums. If you choose this option, make sure to: Consider the value of your property and possessions. Use this calculatorby the Insurance Council of Australia to estimate your building replacement cost. Some body corporates in Kurilpa have introduced a resident’s levy to raise money for self-insurance. Learn more here. Make a plan. What funds could you afford to put aside? How do those funds compare to the potential losses you could face? How might you build a savings plan? How likely are you to save enough before the next flooding event?

2. Mitigate your risk. Mitigating your risk of damage and loss can help you to ‘get back to normal’ quicker and cheaper. You will need to consider:

   • Structural changes to your building. Are there renovations or adjustments that you can make to your property to reduce your risk of flooding? You might choose to consult a surveyor on how to best do this. Learn more about flood mitigation for apartments in our Apartment Toolkit.

   • Personal planning. Reflect on past flooding events and make a plan for when and how you will relocate your possessions. Who might you contact to help if you are away or unable to do so yourself? If you’re in an apartment building, does your body corporate have a flood mitigation plan and procedures to support residents relocate their possessions from basement storage?

As a community, there are collective actions that can be undertaken to help navigate the changing flood insurance landscape:

1. Risk mitigation activities.

   • Structural changes to our urban environment. Are there any adjustments you can make to reduce your street’s risk of flooding? For example, building a rain garden to absorb stormwater.

   • Social resilience. Make a plan with your neighbours about how to support each other in the event of a flood. You might consider certain people’s access needs and whether some people might require additional support to relocate possessions or evacuate.

2. Engage, support and follow local community groups. Resilient Kurilpa, Community Plus and the West End Community House, West End Community Association and Kurilpa Futures are a network of volunteers that communicate local knowledge and warnings in times of floods. Reach out to support these groups and share their resources to help more people plan for future floods in Kurilpa.

Governments have introduced policies to support the flood insurance market in other countries. In future, potential support may include:

1. Setting up a national flood or multi-risk pool. There is growing pressure to introduce a national flood or multi-risk insurance pool at a federal level in Australia. New Zealand introduced a natural hazards insurance (NHI) scheme in 1945, following the major earthquakes of 1942. The NHI scheme covers people with a home insurance policy by charging a levy as part of the standard insurance premium. In Australia, we could consider:

   • National cross subsidy model. This is where the premium from lower risk properties subsidises the premium costs of higher risk properties.

   • Multi-risk pool. This involves diversifying the risk by including all disaster events (flood, cyclone, bushfire, etc.) assuming that all events won’t happen simultaneously.

2. Better management of disaster relief funding. Establish consistent models of disaster relief funding and provide more education on how the funding can be accessed by flood impacted residents.

3. Reducing our exposure to flooding. Governments should seek to reduce the total exposure to flood risk by avoiding new developments in floodplains that will struggle to acquire appropriate flood insurance. In addition, voluntary buybacks provide opportunities to reduce the total flood risk exposure.

4. Better action on climate-change. Reducing emissions and slowing climate change must be the core long term strategy to stabilise the flood insurance market given that the current pressure on the flood insurance market is driven by a changing climate.