Home News Storms could put countless of Australian properties at risk

Storms could put countless of Australian properties at risk

Font size :
A recently-published study by The Climate Institute showed that an estimated $90 billion worth of housing in Australia could be exposed to extreme events like storms, and this could have a significant impact on the insurance and banking sectors.

Just this year, insurance companies have received more than 11,000 claims with estimated insured losses of $38 million. Most of them are storm-related claims, linked to damaged roofs and gutters, as well as flooding. Severe damages are found on Sydney’s northern beaches, where the most expensive real estate in Australia is located.

According to The Climate Institute’s research paper titled, “There goes the neighbourhood: Climate change, Australian housing and the financial sector,” the risks on homes built in locations where there is increased exposure to weather changes will definitely be exacerbated now that climate changes are happening due to human activity.

“Some housing will become so risky as to be ‘uninsurable,’ with premiums reaching an extremely high level or simply not being offered at all, as insurers deem the risk is unacceptably high. Even a house that  is never actually damaged can be subject to very high premiums if the risk of costly damage is high,” the paper noted.

Examples of such properties are those found in the suburbs of Collaroy and Narrabeen, which are deemed to be notoriously difficult to sell and insure because of storm risk.

“Banks and other lenders will insist that mortgages have home insurance when the loan is issued, but that only covers the first year of their mortgage; generally, it is not checked in subsequent years. Under-insurance is known to be widespread,” said Kate MacKenzie, investment and governance manager at The Climate Institute. “Homeowners will often turn to their insurance, but some hazards are generally not covered by home insurance.”

With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now

Mortgage News and Articles

MyState refunds over-charged interest and fees to customers MyState refunds over-charged interest and fees to customers

These errors were the result of shortcomings in MyState’s manual administration processes, ASIC said Read more

House prices return to more affordable levels in mining towns House prices return to more affordable levels in mining towns While the end of the mining boom has had a negative impact on property prices, homes in the region have become more affordable ... Read more

Borrowers should anticipate a possible rate hike Borrowers should anticipate a possible rate hike Some experts advise borrowers to look for a fixed loan that allows extra repayments so that they can whittle down the balance sooner ... Read more

Why choosing the right mortgage is hard for first-home buyers Why choosing the right mortgage is hard for first-home buyers Many feel overwhelmed by the sheer range of products and interest rates on offer, a new survey reveals ... Read more

More mortgage news and articles

Sponsored Links

Friday, Jul 28, 2017
Top Featured Rates
Top Bank Rates

Get help choosing the right home loan

Let us help you find the right home loan for your needs.

Tell us a bit about your circumstances:
  • Purpose of mortgage
  • Household Income
    $
  • How much do you want to borrow?
    $
  • How much deposit do you have?
    $
  • How much is your house worth?
    $
  • How much do you still owe on your mortgage?
    $
  • What type of mortgage do you have?


  • How much is your new home?
    $
  • How much do you want to borrow?
    $
  • How soon do you want a mortgage?
Next
  • First name
  • Last name
  • Where do you live?
  • Phone number

Special Offers

Related Keywords