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Resilience through the lens: Ten years on, David Sinai reflects on Australia's La Niña of 2010/11

During the summer of 2010/11, Australians watched as Queensland bore the brunt of extreme rainfall and flooding from one of the most intense La Niña seasons on record.

Indeed, the wettest years on record in Australia are associated with the La Niña events of 2010-12 and 1974. Now, a decade on from the Brisbane floods (and the frightening flash flood events in Toowoomba and the Lockyer Valley), we reflect on the devastation across swathes of Queensland, and remember those that lost their lives.

One particular aspect of the 2010/11 floods worth recalling is how the economic impact of these floods was broadly felt across Australia after the Federal Government rolled out a special tax levy to fund the AUD 5.6 billion flood damage bill. The insured loss for that Queensland summer – estimated by the Insurance Council of Australia to be in the order of AUD 2.3 billion (indexed to 2017 values) – was clearly only a fraction of the total damage bill. This highlighted the large flood insurance protection gap in Queensland on both private and government assets and exposed the opportunity to more widely use risk transfer mechanisms to pre-fund losses, as opposed to post-funding through community taxes. 

In the years following these floods, Australia's insurance industry responded by more broadly rolling out flood cover for private homes. Developments in flood risk assessment, such as the National Flood Information Database and other bespoke methods, meant that insurers offered this new product at prices based on the risk level at the individual property. It is acknowledged that this risk-based pricing approach can lead to affordability issues for those with the highest levels of flood risk, but this price signal does also reinforce the role that governments (via risk mitigation and planning) can play in reducing flood risk to keep premiums at affordable levels.

The events of 2010/11 (and 1974) also remind us of the significant role that La Niña plays in driving Australia's weather variability, whilst also giving rise to some of our worst individual insurance disasters and aggregate disaster seasons. Warmer ocean temperatures under La Niña conditions mean that the east coast of Australia experiences twice as many floods during La Niña years than El Niño years, and these same conditions are also known to increase the average number of cyclones in a season. Swiss Re's own analysis of historical insured losses in Australia under different ENSO modes shows that the flood losses under La Niña are 1.7 times the average loss, and for cyclone, 1.6 times the average.

As my colleague Alex Pui addresses in a recent article, the current 2020/21 summer's La Niña got off to a slow start, however, we're now experiencing widespread rainfall across the Northern and Eastern Seaboard of Australia under the influence of a mature La Niña event. At the time of writing, ex-Cyclone Imogen is decaying across northern Queensland, triggering flood warnings in many river basins. On the 10-year anniversary of the 2010/11 Queensland floods, these warnings come as a timely reminder of the need for Australia to become better prepared for these inevitable events, through the combination of mitigation, resilience and risk-transfer.