The federal budget has allocated $138.7 million over four years to natural disaster support measures, as insurers continue to press for increased resilience investment. 

The total includes $73.3 million to increase the National Emergency Management Agency’s capacity to support people “before, during and following a disaster”, and $35 million to bolster the aerial firefighting fleet and undertake a review of long-term options. 

It includes $26.8 million to maintain the national stockpile of disaster response resources and $3.6 million to provide targeted mental health support to emergency service workers. 

“We will also continue our work with the insurance sector through the Hazards Insurance Partnership and across the federal government to identify further ways to reduce disaster risk and put downward pressure on premiums,” Emergency Management Minister Murray Watt said. 

The federal government previously committed $1 billion over five years from 2023-24 for resilience spending through the Disaster Ready Fund.

Insurers are looking for an extension of that funding and further commitments. 

“The overall investment in resilience and mitigation remains below where we need to be as a nation,” Insurance Council of Australia CEO Andrew Hall said. 

“The budget papers show that the forecast cost to the Commonwealth alone of recovering from the disasters of recent years has increased by almost $4 billion just since December, highlighting why investment in disaster mitigation is more important than ever.” 

The National Insurance Brokers Association has welcomed measures for small business, with $641.4 million allocated for targeted support, and the disaster resilience and preparedness spending. 

“Brokers play an integral part in helping communities after natural disasters, and NIBA welcomes the disaster resilience measures outlined in the budget and the minister's commitment to working with industry to put downward pressure on premiums,” it said. 

The government has allocated $700,000 to undertake a review of options for the future of the Defence Service Homes Insurance Scheme. 

The external review, to come in the first half of next financial year, will consider how best to ensure eligible veterans and serving members have access to affordable building insurance and “will inform future design improvements to the program”, a Veterans’ Affairs Department spokesperson told insuranceNEWS.com.au. 

The scheme has been operating since 1919, with many features of the original program still intact. 

“The past few years have been challenging for DSH Insurance due to increases in claims from extreme weather events (including bushfires, hailstorms and floods), combined with low investment returns and increased pricing on reinsurance premiums,” the budget papers say. 

“These are industry-wide challenges affecting all general insurers.” 

Treasurer Jim Chalmers said last night that helping people with the cost of living was a budget priority. Measures included tax cuts and power bill relief, while the budget also included investments in renewable energy. 

The Actuaries Institute has welcomed substantial public funding, investment incentives and other support for disaster resilience, climate adaptation and the shift to clean energy.  

“But we reiterate a significant uplift in public sector investment is required, as well as public-private sector partnerships, to close the adaptation finance gap,” CEO Elayne Grace said.