Victorian government insurance premiums to soar due to climate change
Monday, 7 January 2013
The Victorian government faces significantly higher insurance costs and liabilities for government-owned assets due to the projected impacts of climate change, according to government documents released to Environment Victoria under Freedom of Information (FoI).
The report, entitled ‘The Potential Impacts of Climate Change on the Victoria Managed Insurance Authority’s Insurance Portfolio’, assesses the government’s insurance liabilities over the next 20 years resulting from climate change. It was undertaken by Aon Benfield for the Victorian Managed Insurance Authority (VMIA), the state-owned authority that insurers government assets including schools, hospitals, roads, bridges and rail.
The report finds that VMIA has already incurred losses due to severe climatic events such as bushfires and floods and that these losses will increase as climate change drives more extreme weather events. In addition to the increased insurance costs, the report notes the government’s growing exposure to personal and professional liability claims that are expected to flow from more severe climatic events.
Environment Victoria was only granted access to the report following the threat of legal action after initial FoI requests were denied.
Environment Victoria CEO Kelly O’Shanassy said today:
“Because of climate change, Victorians are exposed to more frequent and dangerous weather events such as bushfires and floods which pose a grave risk to life and property. This report shows that state assets will also be affected, increasing insurance costs that will ultimately be born by the tax-payer.
“Scientists, progressive businesses, Victorian communities and now insurance experts all point to the risks posed by climate change to Victoria yet the Baillieu government continues to neglect its obligations to take action to reduce greenhouse pollution from Victorian coal plants, factories and transport systems.
“Since being elected, Premier Baillieu has dumped the state’s greenhouse pollution reduction target, removed pollution limits for new power stations, signalled their intent to export Victoria’s highly polluting brown coal and by doing so increase global emissions, slashed support for solar, and made it virtually impossible to build new wind farms in Victoria.
“It defies logic that our government could understand the risks climate change poses to Victorians and then knowingly make the problem worse.
For further information or comment contact:
Kelly O’Shanassy, CEO, Environment Victoria – 0421 054 402