How home insurance can help us adapt to climate change

As long fire seasons and hot weather increase, and extreme weather becomes more frequent and severe, insurance companies will seek higher premiums in order to keep pace with higher pay-outs. Insurers point to the unexpected high costs of rebuilding what are quite large homes in Australia, as well as recent extreme weather events (such as the 2011 Queensland floods).

Stuart Williams at the School of Geography and Environmental Sciences at University of Tasmania argues that we should take a cue from insurance companies in our efforts to adapt: where insurers are reluctant to insure or ask high premiums – large homes with many possessions in high-risk areas (fire-prone bushland or flood plains) – should be where governments, companies, and individuals are reluctant to build or buy homes. He argues that changes in how we live – the size and materials of our homes and where we locate them – must change if we’re to adapt. Unfortunately, as he rightly points out, the least able to move or redesign homes are and will continue to be the most vulnerable; those in charge of housing the most vulnerable (i.e. governments) must think twice about where, and how, they build and rebuild.