Vol. 20, No. 1, 2023: Is regional Australia uninsurable?

Is regional Australia becoming uninsurable? Has it already passed a point of no return? It’s a confronting question, with uncomfortable answers.

This edition of the Farm Policy Journal tackles an issue that is front of mind for many of us. The worsening impacts of climate change are impacting Australians across the board. An alarming Climate Council study reports that more than 80% of us have experienced a disaster in the past five years, with the majority of affected people (unsurprisingly) living in rural and regional areas. Almost one in 10 of the study’s respondents who experienced a disaster had their home destroyed or deemed uninhabitable, and one in five had no insurance.

The economic impact of uninsurability on regional Australia is deeply concerning. Yet even more dire is how significantly the combined threat of danger, stress of rebuilding and anxiety over a shrinking pool of options is exacerbating mental health distress in rural and regional communities.

Our reliance on insurance as a primary (or often sole) risk mitigation strategy has left regional Australia vulnerable. Cost and access issues are forcing a rethink on how the worsening climate impacts are managed, from both customers’ and product providers’ perspectives. Restructuring in insurance provision means regional Australia must disperse the twin risks of potential natural disasters and overreliance on a now-tenuous strategy.

The articles in this Journal offer insights on the impacts of uninsurability, and options to better manage, mitigate and minimise these risks.