With Australians enduring intense climate-related disasters during the past five years, analysts and lawyers are warning that prospective homeowners and investors could be buying into a perfect storm.
Making buyers aware of the potential bushfire, flooding and coast erosion threats to property could be a compliance issue for governments, property lawyers, and the insurance industry.
A 30-year climate outlook exclusively commissioned by The Australian Conveyancer magazine exposes threats to thousands of properties in NSW and suggests owners will be impacted by land valuation, zoning restrictions and insurance premiums.
The Australian Conveyancer Magazine’s February edition unpacks the implications for owners, investors and the property industry in a 20-page spotlight report.
The digital magazine can be viewed here.
Scientific modelling from Groundsure’s ClimateIndex details the regions more affected by lightning strikes and bushfires in the next three decades; shows how some current flood zones will worsen; and why more beach-side properties will suffer severe erosion.
It says, the impact on safety, development planning, land values and compliance is real:
- It claims that 40 per cent of all properties in NSW are now at moderate to high risk of flooding.
- The risk of catastrophic loss, both financially and physically, will drive up insurance premiums.
The report also draws attention to the state’s experience of catastrophic events during the past five years:
- NSW’s so-called Black Summer bushfires of 2029-20 cost $4.9 billion.
- Insurers have paid our $13 billion in climate-related claims in NSW.
- The combined value of coastal properties exposed to coastal erosion damage is $25 billion.
Detailed mapping shows the extent of the risk but also provides relief to some property owners and investors.
- Some suburbs and land lots will see reductions in risk from the elements due to favourable weather forecasts.
- Some regions will see no change at all. But for many, the situation will worsen during the next 30 years.
The digital magazine can be viewed here:
Key facts:
- 40 per cent of all properties in NSW are now at moderate to high risk of flooding.
- The risk of catastrophic loss, both financially and physically, will drive up insurance premiums.
- NSW’s so-called Black Summer bushfires of 2029-20 cost $4.9 billion.
- Insurers have paid our $13 billion in climate-related claims in NSW.
- The combined value of coastal properties exposed to coastal erosion damage is $25 billion.
- Some suburbs and land lots will see reductions in risk from the elements due to favourable weather forecasts.
- Some regions will see no change at all. But for many, the situation will worsen during the next 30 years.
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Insurers cannot keep paying out for the climate – related increases in bushfire, flood and storms, and coastal erosion. The ever higher premiums mean some people have no insurance and have to live in hope that Government and local community generosity will help them to survive a disaster. Meanwhile little is being said about the greatly increasing costs to local councils as roads deteriorate, bridges are undermined and roads are closed by landslips.
Already we see significant market failure in areas where insurance companies are refusing to provide cover.
Here is an interesting article:
https://www.mckinsey.com/industries/financial-services/our-insights/climate-change-and-p-and-c-insurance-the-threat-and-opportunity
Never mind, and don’t y’all worry ’bout that!
The LNP via the Duttonate have a handle on it, and know how to fix it.
With the Beetrooter the keeper of the secret cure-alls.
(end of sarc)
Some time ago, months perhaps, or longer, I posted a comment in these pages in regard to the emerging consequences of climate change.
That comment, lifted from a book called Learning to Die in the Anthropocene-Reflections on the End of a Civilization, written by an American named Roy Scranton around 2015, was “We’re fucked. The only questions are how soon and how badly.”
Eight years after publication and nothing he wrote seems able to be contradicted. In fact, globally, with respect to climate and weather-based phenomena, things have only steadily – or unsteadily, take your choice – worsened. Today’s press reports cite Western Australia’s recent heave waves as the ‘gifting’ that state to be the hottest location in the world. Not a single day passes without media reporting from someplace or other extreme weather events; fires, floods, droughts, cyclones… the list goes on & on, along with the knock-on effects to humanity along with the kingdoms of fauna & flora.
I was also reminded, again in these pages, that ‘it ain’t over until the fat lady sings.’ I don’t disagree, and I’m not a naturally pessimistic individual, humanity after all demonstrating again and again its capacity to react & respond to challenges, but there is a limit to our adapability. We’re an organic composition, after all, and like all living organisms, we exist within a window of acceptable circumstances; too cold, we freeze, too hot, we boil, too dry, we desiccate and so on.
It’s yet to be unreservedly demonstrated that we’ve got a bunch of bullet-proof solutions for the present and emerging challenges that confront us, locally & globally. The miniscule portion of humanity that can afford to might scrape through by virtue of utilising technology to keep themselves alive in an uninhabitable biosphere but the far greater portion of humanity, as Scranton pungently asserts, will be fucked.
We lost all of our insurers of last resort when the states sold off their State Government Insurance Offices (Including the TIO in the NT).
Why do you think the states first created these insurance offices after federation ? It wasn’t to make a quid. It was because the private insurance industry were fickle ‘Fair weather friends’. They only play while they are winning and in recent years they haven’t been doing as well as they would like so they pull out of the market or price themselves out.
We need a national insurance office !
Know the destination, then pave your way there. It might take a few decades but the profits are worth it.
Councils, bow to developer pressure to rezone flood-prone land as residential, check.
Developers, scope land that is long-term useless, get it rezoned residential, laugh all the way to the bank, check.
Bankers as lenders, turn a blind eye to what is guaranteed to prove a flood or fire hazard down the track, check.
Media, hype up ‘you never lose on real estate’ until the cows, real or 3D printed look-alikes, come home, check.
Pollies, maintain max pressure on all factors that feed the fear of missing out in getting on the property ladder, check.
Insurers, buddy up with a banker mate, turn a blind eye to Council rezoning which is bound to trigger payouts, check.
Environmentalists, claim the high ground and spend decades pushing back on home owner requests to reduce fire hazards, check.
But what to do practically? How about some unmanned aerial vehicles to deploy rainfall catalytic bombs (US Patent 2023141493).
They could be launched to quench local fires or to cause flooding in adjacent valleys to where you live thus diverting any local floods?
caveat emptor is behind the rich ripping off the borrowers.
The profits from insurance has seen a proliferation of companies taking their cut. Most of whom are for profit only.(see 4 corners??)
Of course we can believe politicians’ caring words like:
‘Treasurer Dave Tollner and Chief Minister Adam Giles pledged to redeploy the 43 TIO workers who will lose their jobs after TIO was sold’.