Mid North Coast families know their homes will flood again – they just can't afford cover

Despite living one block back from the river in North Haven, Rebecca Buckley and her husband Heath don’t have flood insurance. They simply can’t afford it.

One-metre high floodwaters inundated the duplex in March 2021. Five years on, and Buckley says she continues to live with fear of the next disaster. 

Her family’s story is not an isolated incident – and government officials have been meeting with insurance professionals to find a solution.

What happened: On February 18, local representatives from across the Mid North Coast met with Andrew Hall, CEO of Insurance Council of Australia, and Janelle Saffin, Minister for Recovery in Kempsey.

The topic? How insurance could be made more affordable for people living in flood prone areas on the Mid North Coast.

• Member for Oxley Michael Kemp and Kempsey Shire mayor Kinne Ring were present at the roundtable, along with Legal Aid NSW Disaster Response, NSW Reconstruction Authority, Macleay Valley Business Chamber and small business owner representatives. 

Below the poverty line: Kemp told the Mid North Coaster the closed-door discussion was about representing locals living in flood zones who, without insurance, are struggling to stay above the poverty line after a disaster hits.

Kemp painted a picture of the mum and dad that have just bought their first house. 

• “They might have been working for an extended period of time,” said Kemp, “they might have had their first kid. They were able to afford to buy a house in a lower lying area, and then an incident like a flood comes along and puts them below the poverty line for a long period of time.”

Kemp said major climate events like the floods that hit the MidCoast and Kempsey Shire LGAs hardest in May, leaving hundreds of homes uninhabitable, have left some families struggling to ever get out of the poverty line once they experience an incident of that magnitude. 

Before and after: For Rebecca Buckley and her family, there are two parts of their family history: before and after the flood.

• “Before the flood, I used to love laying in bed listening to the rain. Now it gives me anxiety,” Rebecca told the Mid North Coaster.

Buckley and her partner have home insurance, but have had to opt out of flood cover, with quotes of “an extra $20,000 on top of what we’re already paying” leaving them without much choice.

The couple are far from the only people on the Mid North Coast who can’t afford flood cover, with some households completely uninsured. 

With severe weather events, like floods, predicted to become more frequent and more intense as global temperatures rise due to climate change, locals have been left with little indication that things are going to improve.

Finding a solution: Oxley MP Kemp said the issue comes down to insurance not being an option for households in flood zones – it is either not offered as an option, or insurers will not offer home insurance without flood cover included, which makes the premium unaffordable.

• “What we're seeing at the moment is banks are not lending based on homes that are in flood zones, irrespective of whether they're in a flood zone that's 1-in-500 or 1-in-10 [years],” Kemp said. “They're not lending unless you have flood insurance, and insurers are not offering home insurance unless you have flood insurance.” 

Rebecca said in recent years her contents insurance has tripled in price. She was forced to cancel and find another insurer.

• “It was basically them saying we don't really want to insure you, so we're going to put it up this crazy amount and if you want to pay it, then you're an idiot. But if you don't want to pay it, then fine,” Rebecca said.

No affordable alternative: After repairing the damage caused by the 2021 flood without financial assistance, the Buckleys considered relocating but wondered if anyone would buy their home located in a flood zone.

They looked at building higher, but at the time they estimated it would cost more than $100,000 just to lift the house.

• “We really can't afford not to have flood insurance, but we can't afford to have it either. It’s a bit of a catch 22,” Rebecca said. 

Flood-prone region: According to NSW Government natural disaster declarations, the Mid North Coast has been hit with 17 flood events since the 2018/19 financial year with some areas flooding multiple times in one year. 

Extreme weather worsening: As risk from extreme weather rises, so does the price of insurance premiums in disaster-prone areas of Australia.

In 2024, The Insurance Council of Australia (ICA) provided a submission to a Parliamentary Inquiry.

• Its key point: Premium increases in Australia are being driven by the impact of worsening extreme weather events, along with development and growing asset values in higher-risk areas and higher inflation.

The ICA said this is widening the gap between those who can afford insurance and those who can’t, particularly in areas most vulnerable to extreme weather risk.

• According to 2022 research undertaken for the ICA by the McKell Institute, direct costs from extreme weather events in Australia will reach $35.24 billion by 2050.

Insurance Council weighs in: To address insurance affordability over the short to medium-term, the ICA said it is critical to strengthen the resilience of communities to better withstand the disasters Australia is experiencing, including investing in resilience-enhancing infrastructure. 

For the long-term, it said “industry and governments need to continue to tackle the underlying driver of worsening extreme weather, climate change, by maintaining a focus on achieving net zero emissions by 2050”.

Next steps: Kemp said all those who attend the meeting in Kempsey, and any member of the public, are invited to submit any questions regarding flood insurance for the Insurance Council of Australia and  Minister Saffin through his office.

• “[Hall and Saffin] are committed to answering them in writing, which we will then make an infographic for and distribute it amongst the Manning and Macleay communities,” Kemp said.

Thumbnail images supplied by Rebecca Buckley.