The maps that show how climate change is driving up the cost of insuring Melbourne homes
Pascoe says that after the damaging storms, weakened trees continue to come down on Mount Dandenong, disrupting power lines and people's lives.
She and her partner have had to reimburse guests on multiple occasions when power outages hit.
'People are not properly compensated,' she said. 'There's often businesses that are throwing out produce; people have generators and have to rely on that ... and our [business's] insurance is far more expensive than it was before the storm.'
Data collected exclusively for this masthead from about 40,000 online quotes for building insurance premiums in Melbourne suburbs, compiled by actuary and insurance consultants Finity, shows Pascoe's experience is far from isolated.
Finity collected quotes from eight insurers over a six-year period across metropolitan Melbourne, representing the amount that customers would pay if they were taking on a new building insurance policy for a typical risk profile in the local government area.
Principal Stephen Lau said the most expensive climate-related events in the past 40 to 50 years, from an insurance perspective, were floods, bushfires and the 1999 Sydney hailstorm that caused $8.9 billion in normalised losses (adjusted for inflation, exposure and building stock).
'And that's then passed back down to consumers ... if there's higher reinsurance risks, they pass down higher reinsurance costs.'
While Black Saturday and Black Summer had increased insurance premiums, Lau said the most expensive climatic event from a normative loss basis were the 1999 hailstorms.
Rounding out the top three were the 2022-23 floods across south-eastern Australia, and the Black Summer bushfires.
In Melbourne, the municipality with the lowest average insurance premiums was Whitehorse, which had an average insurance premium of $1609 – almost three times lower than the Yarra Ranges Shire.
Lau said the Bayside, Stonnington and Port Phillip local government areas had higher-than-average premiums due largely to the higher cost of housing and larger-than-average property values insured.
Insurance Council of Australia chief executive Andrew Hall called for a 10-year, $30 billion flood defence fund that would be jointly funded by federal and state governments, to develop flood defences, retrofit homes and relocate people where no other mitigation was possible.
'The cost of extreme weather is growing,' he said. 'Over the past five years, the annual average insured cost of extreme weather has reached $4.5 billion [nationwide], 64 per cent higher than the previous five-year average.
'This trend is expected to worsen, which is why we must invest in risk reduction, mitigation and adaptation.'
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