This report shows that the impact of extreme weather on the Australian economy has more than tripled over the last three decades.

Insured losses from declared insurance catastrophes have grown from 0.2 of GDP from 1995 to 2000 to 0.7 per cent for the last five years, meaning extreme weather losses are consuming more and more of our economic resources.

Policy recommendations for federal, state and territory governments

• Increase investment in resilience and mitigation funding, as part of a 10-year rolling program with indexed funding to reduce risk.
• Prevent development of homes in high-risk locations and undertake home buy-backs where there is no viable way to protect against the risk.
• Reform unfair state taxes and levies on insurance products that increase the cost of insurance premiums.
• Implement formalised recovery arrangements for greater coordination and collaboration between governments and the insurance industry.