Rising sea levels are likely to exacerbate the impact of severe storms as global warming continues, providing challenges for planners and insurers, according to Finity Principal Tim Andrews.

“Storms, when they occur, are going to be occurring at higher sea levels, and that is perhaps going to be the most significant impact in many cases,” he told insuranceNEWS.com.au after addressing the Actuaries Institute’s climate change risks seminar last week.

Mr Andrews says scientific modelling that looks ahead more than 50 years suggests that while southern Australia will have fewer low-pressure storms, their severity will be greater.

But properties are still being built in low-lying areas near the coast, despite increasing awareness about potential risks.

Mr Andrews says insurers have been active in climate change discussions, but it is difficult to reflect the long-term risk in current policy pricing that is renewed each year.

“They are not trying to price for the risk that exists 50 years from now – they are trying to price for the risk that exists next year. There is an expectation on insurers to have a role in this climate change debate and some people say it can be via the price signal, because they can send a signal as to how that risk is changing. But that is happening very gradually.”

He says there is still much debate on the impact of climate change on future storm activity, while patterns are also influenced by factors such as the Indian Ocean Dipole and El Nino and La Nina effects.