With Australia facing a potentially catastrophic bushfire season, insurers are working to better educate vulnerable communities, while brokers move towards a risk-based advice model.

As of September 2023, an El Niño event is officially underway in the Pacific region. The Bureau of Meteorology is predicting higher chances of above-average temperatures and below-average rainfall for almost the entire country during the summer.

The Climate Council’s report, Powder Keg: Australia Primed to Burn, shows that the protracted La Niña event which resulted in three years of cooler and wetter-than-average conditions has led to the prolific growth of vegetation. 

This vegetation is now drying out, creating potentially catastrophic conditions.

Insurers are among those urging communities and householders to prepare for what is likely to be the most significant bushfire season since the 2019–20 black summer fires. 

However, new research released by Suncorp Insurance found that many of the people most at risk lack critical knowledge about the dangers they may face. 

This gap in understanding extends to a limited awareness of fire behaviour, with over half of the respondents being unaware that rivers, creeks, and roads cannot impede the path of a highly intense bushfire.

The survey also revealed little awareness of how far fire-raising embers can travel — up to a frightening 40 kilometres, according to the Bushfire Foundation.

Educating at-risk communities

Suncorp Insurance climatologist Rhys Whitley warns catastrophic bushfires will remain an ever-present danger.

“Monitoring of conditions (including fire weather, fuel loads) and extensive planning (i.e. property development, evacuation of communities and fire-fighting resources) is something we consider as a high priority,” he says in the research. 

“We also encourage homeowners to use the information available to them to be prepared for not only the upcoming bushfire season but all future ones.”

Suncorp has combined its claims information with climate data and historical fire records to identify regions that are susceptible to bushfire risk and showing increased activity.

“We’ll be reaching out to Suncorp Group customers who reside in high-risk bushfire areas to remind them to prepare their homes, and ensure they have the right level of insurance cover for their needs,” Suncorp’s head of home claims, Alli Smith, said in a media release.

Allianz has produced a series of publications to help brokers prepare their clients for extreme weather including bushfires, storms, floods, and cyclones, distributing the content via its broker-facing Allianz Engage page and through broker communication lists. 

Allianz is also helping to take vital information into communities by partnering with the Big Map initiative developed by Disaster Relief Australia (DRA), says Ben Church, NSW State Distribution Manager for Allianz Australia.

“Big Maps are exactly that — detailed maps of communities and the surrounding areas that can be laid out on the floor, explored and walked across,” says Church. 

“They’re designed to help people understand how risks and hazards can arise and behave so they can be better prepared, recover more quickly and collaborate on building resilience. When DRA takes the maps into regional towns in New South Wales and Victoria next year, we’ll be inviting both clients and our broker partners to attend the sessions.”

From ‘price’-based to ‘risk’-based advice

Church says that brokers can no longer rely on differentiation through price and should be demonstrating their value through risk-based advice.

“Unprecedented numbers of natural catastrophes, COVID, supply chain pressures and inflation have sustained a hard market for several years,” he says. 

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