Canadian Underwriter
News

Shift in focus needed to help improve Australia’s resilience to natural disasters: draft report


September 26, 2014   by Canadian Underwriter


Print this page Share

There is a need to shift focus by resetting the balance between preventing the worst impacts of a disaster in Australia and paying increasing bills for recovery and rebuilding, suggests the Productivity Commission’s draft report into Natural Disaster Funding Arrangements.

“Australian governments have traditionally been too focused on handing out billions of dollars in an ad hoc manner following a disaster rather than looking at the long-term benefits of investing in permanent mitigation infrastructure to protect vulnerable communities,” Rob Whelan, CEO of the Insurance Council of Australia (ICA), says in a statement.

Whelan has welcomed the draft report, released Thursday, saying that it offers clear signposts to state and federal governments on ways to improve the country’s resilience to catastrophes. He noted that the draft report appropriately concluded that current natural disaster funding arrangements are subject to legacy issues and could be significantly improved in the interest of resetting the balance between preventing the worst impacts of a disaster and paying increasing bills for recovery and rebuilding, notes the ICA statement.

“The ICA supports the draft report’s conclusions that federal financial support for mitigation should be increased and post-disaster support reduced, and that state and territory governments need a sharper incentive to manage, mitigate and insure natural disaster risks,” Whelan says.

He points out that the ICA was pleased the report recognized the important role of insurance in risk mitigation, especially for private assets, and its conclusion that insurance markets were working well for natural disaster risk, with pricing increasingly reflecting individual risk.

That said, ICA notes more can be done to ensure risk-based pricing references the best-available data, and the report calls for improvements in the consistency, sharing and communication of information on hazards and risk exposure.

“The ICA supports the draft report’s statement that households and businesses should be relied upon to manage natural disaster risks to their assets, and its emphasis on the importance of government policies that allow Australians to understand natural disaster risks and manage them appropriately,” Whelan adds.


Print this page Share

Have your say:

Your email address will not be published. Required fields are marked *

*