Land use planning is failing to protect properties from riverine and flash flooding after high intensity rainfall, as risks are underestimated despite the events representing one of the nation’s costliest extreme weather impacts, a research report released today by the Insurance Council of Australia (ICA) says.

Estimates show more than one million private properties, or about one in ten homes, have some level of flood risk and the total cost of floods has topped $21.3 billion since ICA records began in 1970, the report says.

Standards generally require that new houses shouldn’t be located within a 1-in-100 annual exceedance probability (AEP) flood zone.

“Reliance on the 1% flood standard has historically assumed that the residual risk from larger events will be infrequent and minor enough to be generally acceptable to communities,” the report says.

“However, this analysis of flood claims data suggests that contemporary homes built above the 1% flood level are sustaining an unacceptable level of damage.”

The Flooding and Future Risks report draws on analysis by the James Cook University Cyclone Testing Station in association with Risk Frontiers and uses data from thousands of flood claims covering four recent flood events.

The report also calls for building code changes to promote resilience, and proposes action to address data gaps that prevent insurers and homeowners from gaining an accurate picture of the risks, particularly in a changing climate.

“This report again underscores the need to make better decisions in land use planning, building standards and government investment in mitigation works if we are going to end this cycle of flood impacts on homes and businesses in Australia, ICA CEO Andrew Hall said.

“Addressing the risks identified in this report will play a key role in better protecting communities in the face of worsening flooding and help improve access to affordable insurance coverage.”

Data cited in the report says living in a 1% AEP flood zone actually means there’s a 50% chance of being flooded at least once in a 70-year lifetime and a 15% chance of being inundated twice.

“As the climate continues to change, existing flood zones are likely to expand and expose more property and assets as well as increasing the depth of floodwater in currently exposed properties,” the report says.

The report recommends new developments must adhere “to the existing provisions in the floodplain handbook” and consider the consequence and likelihood of the range of possible flood events, including larger and rarer floods beyond the 100-year level. The assessment should also consider climate projections expected over the lifecycle of the building, it says.

The current ABCB Standard: Construction of buildings in flood areas 2012.3, which focuses on preventing a building collapse, is also falling short on resilience, failing to provide guidance on the performance of a house in terms of liveability after an event.

The study finds flood-associated claims are high, with a mean claim of $142,000 for an average sum insured of $528,000. In the case of Townsville floods, affecting many single story structures on a slab, once waters topped floor height most properties required a complete strip out of wall linings, replacement cabinetry and floor linings, including tiles.

The experience in Townsville is typical of modern development and flood repairs across the country, it says.

“This type of damage, necessitating significant repairs and remediation, leads to considerable costs that can lead to high and possibly unaffordable premiums,” it says. “This is despite these modern houses meeting contemporary development controls and building standards.”

The report says codes and standards should prioritise resilience as a principle underpinning the design standard for flood, while research and development is needed on products that can show a reduction in risk to flood-zone homes while also aiming to reduce the cost of resistant construction and retrofit solutions.

Click here to read the report.