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Case Studies » Featured Case Studies » Case Studies » CGU/NRMA: Insurance and weather in Australia - 5. Making Australian communities safer and more resilient to natural disasters

CGU/NRMA: Insurance and weather in Australia - 5. Making Australian communities safer and more resilient to natural disasters

Making Australian communities safer and more resilient to natural disasters

Prevention is always preferable to cure. To achieve this, we need to identify ways to implement resilient and sustainable economic, social and environmental outcomes to safeguard our future. 

Building safer and more resilient communities requires a collective approach from government, business and the community. All  of us have  a responsibility to protect communities so we can reduce the number of lives lost and limit damage to property. Implementing measures to safeguard the future will also  ensure a faster return to work and limit the number of days when businesses are closed. Greater resilience also reduces risk exposure and the cost of insurance claims. This, in turn, helps to keep the cost of insurance down.

Research shows that the budgetary impact of responding to and recovering from natural disasters could be significantly reduced through carefully considered pre-disaster investment.  One dollar spent on mitigation can save at least two dollars in recovery costs.  Federal government spending on mitigation initiatives represents around only 3% of what it spends on post-disaster recovery and reconstruction. An example of investment is providing in the following table:

FY Mitigation and Resilience* Recovery and Reconstruction**
09/10 $21.6M $402M
10/11 $25.2M $997M
11/12 $25.7M $3.38B
12/13 $26.1M $451.3M
13/14 $21.6M $1.94B
14/15 $21.6M $1.16B
15/16 $21.6M n/a

*Funding provided to States and Territories for disaster resilience initiatives under the National Partnership for Natural Disaster Resilience

**Funding provided to States and Territories for recovery and reconstruction under the Natural Disaster Relief and Recovery Arrangements.

Source: Australian Government Budgets.

The following key areas of adaptation will significantly enhance Australia’s resilience to natural disasters:

  • Planning and zoning decisions - the risk of natural disasters must be a determinant of where new properties are built;
  • Digital evaluation mapping - communities require access to information about  flood and bushfire danger zones;
  • Investing in mitigation infrastructure - putting measures in place to protect and minimise the effects of extreme weather events in populated areas;
  • Strengthening building standards - houses need to be built to withstand severe weather conditions;
  • Education programs - educating the community about ways they can prepare for and protect themselves from the effects of extreme weather.

How you can plan and prepare for different weather events

Your level of exposure to natural disasters differs by location. Still, there are important steps everyone can take to prepare for disasters and mitigate possible risks, from installing a fire alarm to elevating or retrofitting a home at risk from flooding. Understanding your risk exposure and what you need to be insured for is also a key step in preparing for natural disasters. Making sure you take out adequate levels of insurance is much more important than just choosing the cheapest insurance policy on the market. Without the right insurance, your home and contents may not be covered in the event of a natural disaster.  Researching and reading insurance policies can be a daunting task.  However, there are advisors who are trained to help you select the right insurance for your needs.  The more you understand your risk exposure and plan for different weather events, the more you can help to preserve and protect the environment you live in as well as the things you value most. 


Insurance claims and recovery advice

The following tips provide a useful guide for what people can do to assist when making an insurance claim:

  • Know who you are insured with and keep their contact details in a safe place;
  • Contact your insurance company as soon as possible after the event to register your intention to claim and seek advice about the claims process;
  • If your home or business property is damaged, make temporary repairs only to prevent further damage. If possible, take photos of the damage before you start repairs;
  • If your assets (furniture, clothing, or carpets) have been damaged, remove them as part of a general clean-up. If possible they should be kept in a safe location so they can be inspected as part of the claims process if necessary.



The most effective safeguard against floods is accurate flood data to ensure houses are not built in flood zones. Municipal councils are responsible for the maintenance of flood maps, which can be used to help residents understand the risks associated with living in flood-prone areas. Council flood maps are the best source of information because they know their local area better than anyone else and have access to detailed and specific data.

Insurers use flood maps and data to determine the price of insurance premiums.  The price of insurance (premium) depends on the risks involved and flood risk is usually targeted to specific geographic areas. In addition, flood damage is expensive to fix. So if homes or businesses are located in a flood prone area they will be more expensive to insure.

Flood levees are the most effective and widely used protection against floods. A levee is a structure designed to prevent or control flooding. These man-made structures are used to divert water from a flood-prone area so that communities can be protected.


The nature of bushfires makes them difficult to prevent. Every house in a bushfire zone must have a plan that can be readily activated. There are additional precautions that can be taken in high risk bushfire areas to reduce the risks. These include:  keeping foliage under control; ensuring gutters are clear of debris; planting trees that are less likely to ignite (due to lower oil content); keeping firewood and mulch away from the house; and installing sprinkler systems and ember screens.

When a fire approaches, more extreme measures need to be taken. These include: filling gutters with water; moving flammable items such as outdoor furniture, doormats, hanging baskets away from the house; hosing down the outside of the house; and ensuring the valves on gas cylinders are not facing the house (Source: NSW Rural Fire Service).

(Page 6 of 7)
Associated with:
Learning Area(s):
  • Business Environment | Stakeholders
  • Business Environment | The external environment
  • Business Environment | The role of business in the economy
  • Ethics and Social Responsibility | Risk Management
  • Ethics and Social Responsibility | Socially responsible programs and approaches
From: Edition 8

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