The Insurance Council of Australia (ICA) has escalated its significant event declaration to an Insurance Catastrophe for the dozens of bushfires impacting Victoria since 7 January, which have collectively burned about 985,000 acres.
According to Aon’s weekly catastrophe report, the fires have damaged or destroyed roughly 260 houses and 900 structures, caused major agricultural losses and one fatality, and are expected to continue burning for weeks.
Since January 1, 160 individual bushfires have been recorded. While the size of the burned areas and their proximity to vulnerable assets vary widely, most pose only a limited threat.
The most significant risks are concentrated in the state of Victoria, including the Berrys Lane–Longwood Fire north of Melbourne, the Walwa–River Road Fire between Melbourne and Canberra, and the Streatham Fire east of Melbourne.
With all this in mind, economic losses are likely to reach hundreds of millions of USD.
Since the ICA’s initial Significant Event declaration, insurers have reportedly been able to further assess the large recovery effort that will be required as a result of these severe bushfires, with 2369 claims being lodged to date across property, commercial and motor.
“Current indications suggest around 30 per cent of all property claims are total losses. The extent of commercial losses will also be significant as a result of this event, and we anticipate increased claims numbers as people start to return to their homes and businesses,” the ICA added.
The ICA’s Catastrophe declaration serves to escalate and prioritise the insurance industry’s response for affected policyholders.
ICA Deputy CEO Kylie Macfarlane commented, “These bushfires have been devastating for many communities across Victoria, and insurer’s priority is getting help to people as quickly as possible.
“We acknowledge that a large recovery effort will be required to help the state recover from this catastrophic event, and insurers stand ready to support communities in this process.
“I’d encourage Victorians impacted by these fires to get in touch with their insurer and lodge a claim. They can do so even if they do not know the full extent of damage and may have not returned to their home or business as yet.”
