Catastrophe events and the community

What are catastrophe events?

Catastrophe events are large natural or man-made disasters that cause a significant number of claims in a region.

Catastrophe events involving large numbers of claims, or complex issues, are coordinated through a general insurance industry taskforce that is established for each event and closed when the insured community recovery is completed.

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10 Largest Catastrophe Events in Australia (2011 adjusted dollar amounts)

Rank

Event

Year

Location

State

Loss (AUD$)

Normalised Loss* (2011) (AUD$)

1

Hailstorms

1999

Sydney

NSW

1,700,000,000

4,296,000,000

2

Tropical Cyclone Tracy

1974

Darwin

NT

200,000,000

4,090,000,000

3

Earthquake

1989

Newcastle

NSW

862,000,000

3,240,000,000

4

Flood

1974

Brisbane

QLD

68,000,000

2,645,000,000

5

Flood

2010/11

Multiple

QLD

2,380,000,000

2,380,000,000

6

Hailstorm

1985

Brisbane

QLD

180,000,000

2,063,000,000

7

Ash Wednesday Bushfires

1983

Multiple

VIC/SA

176,000,000

1,796,000,000

8

Severe Storm

2007

Multiple

NSW

1,480,000,000

1,742,000,000

9

Tropical Cyclone Madge

1973

Multiple

QLD/NT/WA

30,000,000

1,492,000,000

10

Tropical Cyclone Yasi

2011

Multiple

QLD

1,300,000,000

1,352,000,000

*Loss normalisation is used to estimate the losses sustained if past events were to impact present society. The Methodology for Indexation of Disaster Costs by Risk Frontiers used to calculate the 2011 Normalised Cost is also available to registered users of the dataportal. For a more information on catastrophes, access the DataGlobe. Access to the dataportal is considered on a case-by-case basis, but it is intended to be a resource for insurers, reinsurers, researchers and government agencies.

More catastrophe data can be found by clicking here.

What types of natural catastrophe events could impact me?

Types of Natural Disasters

Bushfire - Most property losses occur in NSW, VIC, WA, SA and the ACT between September and March. With increasing urban development and a climate that is both getting drier and warmer, bushfires are an increasing risk for today's property owners.

Cyclones - Most property damage occurs in Northern QLD, NT and WA between December and April. Under climate change predictions, severe cyclones are expected to occur further south than at present.

Hail - Hail is a very significant factor in insured losses. The worst affected states are NSW, VIC and QLD. The worst months for damaging hail are from October to April, though hail can occur at anytime.

Flood - Inland flood is a significant issue in Australia, historically accounting for nearly 1/3rd of insured losses. From an insurance perspective the worst affected states are NSW and VIC, followed by QLD, SA and WA typically occurring from April to October.

Earthquake - Australia has a low incidence of highly damaging earthquakes. The most affected states are NSW and WA, with four significant earthquakes causing an insured loss occurring in the past 40 years.

Severe Storms - The worst affected states are NSW and QLD, followed by WA, VIC, SA and TAS. Most severe storms have occurred between September & February.

What can I do to protect my assets from a catastrophes?

Resilient Design and Planning - A property should be designed so that it is resilient to the hazards present in the environment, both today and into the future to the end of the expected life-span of the building. Property owners and developers should ensure that appropriate materials and design are employed to ensure that the property will survive the predicted intensity of natural hazards in their region into the future. It is important to note that minimum building standards in Australia do not cater for property protection, only safety, allowing occupants time to egress before a building constructed to a minimum standard becomes untenable. Considering a property purchase? Ask the owner or designer about the standards used for construction and the local hazards.

Disaster Planning and Preparation - Consumers should have a relevant emergency plan for their location, designed not only to protect their safety in the event of a disaster, but to save your property where it is possible and safe to do so. Visit your State Emergency Services website to gain more information about the hazards relevant to your area and what plans you can make now to lessen the impacts.

Financial Protection - Appropriate insurance protection over your most important assets is critical to making sure that following an unexpected event you can return to a normal lifestyle as quickly as possible. Australia has a highly competitive general insurance market and cover is available for the majority of conceivable risks to property. Consumers should undertake annual risk planning, taking into account the replacement value of assets and the nature of the risks in their location and then make sure that appropriate insurance is held to cover the risks and the costs. Most importantly, consumers should read and understand the policy they are considering using as protection against the unforseen. Many policies have exclusions that may affect your ability to claim following particular events. These exclusions are notified to consumers during the purchase process and it is critical that they are understood.

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