The insurance industry has recorded over 6,000 claims linked to the recent floods in New South Wales’s Mid-North Coast and Hunter regions, with residential property damage representing the majority of reported losses.
As of May 28, the Insurance Council of Australia (ICA) reported that the volume of claims has grown by more than 20% in the past 24 hours.
As a result, the ICA has designated the flooding as an Insurance Catastrophe, a classification that activates additional response resources and escalates claims processing for impacted customers.
In response, insurers and the ICA have intensified on-the-ground assistance. A dedicated insurance hub has been established at the Taree Leagues Sports Centre, operating until June 13 to provide residents with face-to-face guidance on lodging and managing claims.
Additionally, insurers are present at state-operated recovery centres to support affected policyholders.
The ICA has also dispatched a dedicated catastrophe coordination unit to oversee claims operations and improve insurer engagement with policyholders.
Insurers are using digital tools such as SMS updates, customer advocacy programs, and surge staffing models to manage the growing caseload and offer timely support, particularly to vulnerable individuals.
Andrew Hall, CEO of the ICA, said the extent of the damage underscores the need for sustained recovery support.
“It is confronting to see the extent of the damage across the region, and it is clear the recovery is going to take some time and that means support must be ongoing,” he said.
Hall highlighted that insurers have been operating at elevated capacity since early 2025, following several previous weather events.
Insurers, he said, have significantly increased their workforces since the widespread flooding of 2022 to manage such scenarios more effectively.
“This is our fourth flood event this year. So, insurance companies have been working since January when the floods started up in far north Queensland and we had 10,000-odd claims in that region, moved down to Tropical Cyclone Alfred and the flooding that occurred in Hervey Bay and then down to Lismore, out to Western Queensland and now here on the mid-north coast,” Hall said in a statement.
Hall expressed concern over rebuilding practices in flood-prone areas, noting that unlike other natural disasters, flood recovery lacks enforceable building codes.
“One of the issues with flood, if you think about what happens when a bushfire goes through or a cyclone goes through, we have – homes are often completely destroyed,” he said. “They’re then built back to a bushfire proof standard or in Queensland, they’re built back to a category three or above standard for cyclone. We have no standards for flood. We are expected to build back the exact same property in the exact same location with the assumption that it’s not going to happen again.”
This approach, Hall said, results in repetitive loss patterns, increasing the cost of cover in high-risk zones.
Flood-related insurance affordability remains a contentious issue.
Hall acknowledged that premiums exceeding $20,000 typically relate to properties with recurrent and well-documented flood exposure.
“Insurance is designed to protect you from [the] unexpected – so the accidental fire, the hailstorm, the bad storm that comes. But with flood, it’s been a very different set of challenges, and we’re not alone in Australia. Every other insurance market in the world has the same problem. If an insurance company takes on a house, like a couple of the homes that I’ve seen today here that have flooded three times since 2021, they’re trying to price the cost of restoring or rebuilding that property completely every three years. And that’s how you end up with prices of $25,000, $30,000,” he said.
The ICA has called for a coordinated public-private response to mitigate flood risk and curb rising premiums.
It submitted detailed flood risk modelling to the federal government and proposed a $30 billion decade-long de-risking strategy covering 24 high-risk catchments across the East Coast.
