‘Tipping point’: Climate change blamed for Brisbane’s rising insurance premiums

Hikes in Brisbane’s insurance premiums are affecting the “most vulnerable” as climate change is blamed for rising costs after this year’s devastating floods, experts say.

Half of Brisbane’s homeowners and renters believe insurance premiums are going up because of climate change, following a horror year of floods, rain and storms, according to the latest figures.

New data from Mozo’s annual insurance report found that 38 per cent of Brisbane insurance holders reported their premiums increasing “a little” over the past 12 months, while 16 per cent said they increased “significantly”.

Fifty per cent of those who were surveyed believed climate change was the driving force behind rising premiums with so many more people forced to claim after severe weather events, including South East Queensland’s February floods.

Emergency services at the scene of a flooded home in February. Picture: NCA NewsWire/Tertius Pickard

Mozo’s money expert Tom Godfrey said it was clear extreme weather events had been putting “significant stress” on insurance providers.

“Their customers are likely to feel the effects in the form of significantly higher premiums or in extreme cases, the inability to access insurance,” he said.

Mr Godfrey said insurance was becoming increasingly “out of reach” for a number of Australia’s most vulnerable people.

“As the premium hikes and severe weather events continue to erode the value of insurance for many Australians, many homeowners are increasingly financially vulnerable,” Mr Godfrey said.

“With cheaper housing often built in disaster-prone areas such as on flood plains and in bushfire zones, it’s people who need the most financial protection who can least afford it.”

A flooded property in Clayfield in February. Picture: Zak Simmonds

The data also found that 45 per cent of insurance claims from Brisbane homeowners in the past 12 months listed storms as an issue, and almost a third listed floods.

Nationwide, the data also found 43 per cent of participants claimed they were underinsured.

This included just over a fifth who said their insurance policy would not cover the full cost of rebuilding, repairing or replacing their home, and 22 per cent who said they had to reduce their level of cover to reduce their premium.

“Australia is on a tipping point when it comes to insurance, with the flood of claims in the wake of severe weather likely to keep flowing,” says Godfrey.