The head of Australia’s largest general insurer Suncorp says Australia’s highest flood impact risk zone is greater Sydney.
The head of major insurer Suncorp says homes in the greater Sydney area face the highest flood impact risk in the country.
Despite the attention given to flood damage in Queensland, Sydney’s risk of extensive, costly damage is higher because homes are being built in danger zones, chief executive Patrick Snowball says.
“We’re all familiar with the flooding issues that have impacted Queensland but right here in greater Sydney there are catchment challenges that pose probably the greatest flood impact risk in Australia,” Mr Snowball told a business lunch.
“The risk is highest here because of growing population concentration on the doorstep of the Hawkesbury and Nepean catchments.
“These areas are high risk flood zones and the Warragamba Dam currently offers little ability to regulate water in flood.”
Mr Snowball, a former British soldier who took over Suncorp in 2009, said not enough attention is given to mitigation in Australia to prevent damage from natural disasters.
Mr Snowball told the Trans-Tasman Business Circle lunch that disaster recovery and rebuilding cost Australia $5.6 billion in 2011, while only $27 million was spent on mitigation.
“Yet for every $1 spent by government on mitigation, Australians save between $2 and $10 avoiding the physical and economic aftermath of events,” he said.
“The risks associated with natural disaster and the costs of rectification are increasing right across Australia, primarily due to increased population concentration, development in higher risk zones and the increased size and sophistication of our homes.
“All that is increasing but investment in mitigation is not.”
Calling for higher building standards in cyclone-prone areas and rebuilding away from flood zones, Mr Snowball said insurers had an obvious vested interest.
However he defended his demand, saying Suncorp was owned by shareholders and the risks affected all policyholders who contribute to the pool of insurance via premiums.