Reinsurance News

Severe hailstorms hit Australia, as bushfire losses climb

20th January 2020 - Author: Matt Sheehan

Storms have brought severe hailstorms and heavy downpours to parts of south-east Australia, causing major damage in areas already ravaged by the ongoing bushfire crisis.

hailstoneThe rains and resultant flooding have helped to ease bushfire conditions in some regions, but authorities have warned that the danger is “far from over.”

Insured losses from the fires have also continued to climb, reaching AU $1.41 billion from 16,380 claims as of January 17th.

Since September, blazes have now destroyed over 2,000 homes and burnt through roughly 10 million hectares (25 million acres) of land.

The crisis has been exacerbated by record temperatures and drought conditions over the last few years, and the storms are expected to provide only temporary relief, with many months of the fire season still to go for some areas.

In New South Wales – the state worst-hit by the bushfires – the number of fires has more than halved since the beginning of January, shrinking from 150 to 69 active blazes.

But authorities have also warned that flooding and landslides from the storms have interfered with fire-fighting efforts.

Additionally, strong winds of up to 117 kph have whipped up huge dust clouds that enveloped small towns, worsening the already dangerous air quality caused by ash from the fires.

The re/insurance industry is likely to take a further hit from the event, as hundreds of emergency calls were made to report smashed windows in buildings and cars, caused by hail as big as golf balls in some cases.

Reinsurers in particular are likely to incur a significant loss from the events in Australia, with insurers Suncorp and IAG having already announced that the fires are expected to trigger their reinsurance protection.

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