Insurance industry on alert over floods after Hunter, Mid-North Coast hit by heavy rainfall

The insurance sector is preparing for floods hammering the NSW Hunter Region and the state’s Mid-North Coast to worsen, with warnings of a further 200-300mm of rain set to smash the coast.

Insurers are preparing for floods hammering the NSW Hunter Region and the state’s Mid-North Coast to worsen, with warnings of a further 200-300mm of rain set to smash the coast in coming days.

The Insurance Council of Australia upgraded the floods to a significant event on Tuesday, and may advance to catastrophe status, amid dire concern in the industry over damage to regional towns and rural communities.

The council said its declaration activated processes aimed at ensuring insurers prioritised response to the current floods.

Insurance Council boss Andrew Hall said he was deeply concerned about the potential for the damage bill from the floods to grow, noting insurers were now waiting to see the cost from the first days of floods and storms.

“We will be on high alert now,” he said.

“We’re very concerned we’ll see repeated flash flooding up and down the coast.”

An image released on social media on May 21 showing flood waters in Taree, NSW. Picture: Facebook

The Insurance Council said the worst of the flooding was being felt in Taree, Port Macquarie-Hastings, Kempsey, Nambucca Valley, Bellingen and Coffs Harbour, and into parts of the Hunter.

The insurance industry will now start collecting and reporting data tied to the floods.

Council representatives will also step up work with government agencies to understand the impact of the floods “and ensure affected residents receive assistance”.

Mr Hall said many of the communities facing flooding were those already heavily affected by inundations in 2022, when large parts of NSW were put underwater by torrential rains.

He said the ICA was still looking to determine how many people and businesses in the flood-hit towns had insurance, but warned industry data showed in many high risk areas less than one in four had cover.

“It highlights that the people who can least afford to not have insurance don’t have it because flood risks make their insurance so expensive,” Mr Hall said.

Andrew Hall CEO Insurance Council Australia. Jane Dempster/The Australian.

Australia’s 2022 floods, which hit parts of NSW, Queensland and Victoria, were among the most costly natural disasters ever.

The February-March floods left insurers facing nearly $6bn in costs.

Mr Hall said it was too early to judge the present floods bill as many communities were still being evacuated and few claims had been lodged.

But he noted how some towns inundated had already put their flood protections under review.

The NSW Mid-North Coast town of Taree reviewed building a levee to protect the centre of the riverside town, which sits in the bend of the Manning River.

But in July last year the Midcoast Council put the levee plans on ice, warning they were

“unfeasible and resolved to investigate options for an early warning system through government agencies”.

The review determined construction of the flood protection levee “would be costly, as pumping would be required, and the benefits were not significant to either commercial or residential properties”.

Mr Hall said the floods “continue to underscore the need for a higher level discussion about flood protection”.

Originally published as Insurance industry on alert over floods after Hunter, Mid-North Coast hit by heavy rainfall