The Insurance Council of Australia (ICA) has expressed disappointment over the lack of new long-term investment in disaster resilience in the 2025 Federal Budget, particularly in flood mitigation—the country’s costliest natural hazard.
While the continuation of the Disaster Ready Fund and additional funding for the recovery from ex-Tropical Cyclone Alfred were acknowledged as positive steps, the ICA warned that these measures fall short of what is needed to manage growing climate-related risks.
“Extreme weather events have resulted in record insured losses of $22.5 billion over the past five years,” ICA CEO & Executive Director Andrew Hall said. “Without greater investment in flood mitigation, including the dedicated Flood Defence Fund, risk will continue to rise – placing more pressure on premiums and household budgets.”
The Budget, released in the lead-up to the 3 May Federal election, prioritised cost-of-living relief. However, the ICA reiterated its call for structural reform, highlighting insurance taxes as a key contributor to rising premium costs.
“In a cost-of-living crisis we know urgent action is needed, and the removal of $8 billion in outdated insurance taxes is the most direct path to easing premium pressures,” Hall stated.
The ICA also urged the next government to adopt the recommendations outlined in its Advancing Australia’s Resilience report, emphasising that a clear, government-led strategy on risk reduction is necessary to ensure the affordability and availability of insurance.
“While long-term solutions remain crucial, lowering costs and increasing availability require a clear, government-led commitment to risk reduction,” Hall added.
With the election campaign now underway, the ICA said it would focus on advocating for a national approach to disaster mitigation and resilience.
