How Will Climate Change Affect Your Insurance


Severe Weather In A Changing Climate


IAG and the National Centre for Atmospheric Research (NCAR) have recently finalised a report examining future climate change impacts. The report shows the impacts of climate change are already occurring and extreme weather events are likely to become more frequent and damaging in the future, with different impacts across the country.

You can access the full report here, however we have also summarised the key findings below for you.


Rising Global Temperatures

  • Since the pre-industrial period (1850 – 1900) the average global mean temperature has risen by more than 1o It’s highly likely that this warming will continue and could reach 1.5oC within the current decade and 2oC by as early as 2036.
  • An accelerating change in the average global mean temperature will increase the frequency and intensity of many weather and climate extremes substantially.


Rain and Floods

  • Intense bursts of short-duration rain are expected to increase across almost all of Australia – even in areas likely to become drier overall.
  • This will likely result in increased severe flash flooding in urban areas and small river catchments.


East Cost Lows (ECL)

  • Evidence suggests that we’ll likely see fewer of the less damaging types of ECLs, which normally occur over winter and spring, but we’ll see an increase in the more damaging lows that typically happen over summer and autumn.
  • A recent example of a destructive ECL is the February 2020 storm event across Queensland and New South Wales (which amounted to an estimated $958 million in insurance losses as of 27th August 2020*)

*Data from the Insurance Council of Australia


Tropical Cyclones

  • Tropical Cyclones are expected to extend further south. Risks are likely to increase more rapidly in south-east Queensland and north-east New South Wales.
  • The higher the air temperature, the more water the atmosphere holds and the more energy in the weather systems. Tropical Cyclones in a warmer world will carry more water, which will result in rain over larger areas. This will lead to an increased risk of flooding and wind-driven rain damage.



  • Bushfire weather risk, including the most catastrophic type of fire weather conditions, is expected to increase across most parts of the nation.
  • In a warmer world we should expect longer fire seasons and more extreme bushfires, which will reduce the time between fire seasons for fuel management activities, including hazard reduction burns.



  • The risks of large and giant hailstorms are expected to shift further south down the east coast of Australia.
  • In a warmer climate, damaging hail is expected to increase for the capital cities of Sydney, Canberra and Melbourne.


With the expectation of more frequent and severe extreme weather events, it now more important than ever to review your insurance. In particular, we recommend you review the insured value of your;

We are happy to assist with this review. Please call us today to discuss.