Hot summer leads to more claims

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Insurance claims have exceeded $515 million so far this summer and are likely to jump further as the country continues to grapple with bushfires and severe storms.
The Insurance Council of Australia (ICA) said the figure is made up from four catastrophes, including three major bushfires in Pinery in South Australia, Victoria's Great Ocean Road and in Yarloop in Western Australia, and from the Sydney storm and tornado in December.
"Insurers were expecting this to be a fairly dire summer, all predictions were for a heightened bushfire risk in exactly the areas that have suffered bushfires, and this is still only mid-summer.

The world has also experienced the hottest year on record since 1880. With more evaporation of land and oceans, combined with more mositure in the atmosphere creating more storm activity and then a greater volume being dumped somewhere else on the planet, it is unlikely these events will reduce into the future.

Last changed: Jan 21 2016 at 7:02 PM


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Above-average cyclone season looms

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Insurers should brace for an above-average cyclone season due to weakening La Nina conditions in the Pacific Ocean and warmer than average sea temperatures to the north and east, according to the Bureau of Meteorology.

The cyclone season begins next month and ends in April.

The bureau says Australia has a 67% chance of an above-average season, while the west has a 59% chance, the northwest 63%, the north 56% and the east 58%.

In neutral years the first tropical cyclone to make landfall typically occurs in late December, while in La Nina years it usually hits in the first week of December, the bureau says.

Insurance Council of Australia spokesman Campbell Fuller says even an average cyclone season – consisting of 11 events, four of which make landfall – can be devastating.

“An above-average year could bring many more than that, and each one has the potential to cause catastrophic damage if it crosses the coast in a heavily populated area,” he said.

“Only one cyclone made landfall last season, and that was in a sparsely populated part of WA’s Pilbara. There’s no guarantee Australia will be so fortunate this summer.”

Tropical Cyclone Marcia cost insurers $544 million from more than 37,000 claims when it struck Rockhampton in February last year. In 2011 Cyclone Yasi cost insurers $1.4 billion.

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