Australia’s climate is changing rapidly, and businesses can no longer overlook the impacts. From harsher fire seasons to rising sea levels, extreme weather events are reshaping the landscape for small and medium-sized enterprises.
This guide will help you tackle these challenges and safeguard what matters most to your business.
Rising Temperatures: How They Impact SMEs
Since 2010, Australia has warmed by 1.51°C on land, and, since 1900, oceans temperatures have risen by 1.08°C. While these figures may seem small, they have driven more intense heatwaves and prolonged fire seasons, significantly raising bushfire risks nationwide. The nation’s bushfire season has expanded by 27 days over four decades to 2019, according to the CSIRO.
Studies also show that rising temperatures accelerate the growth of invasive species, some of which increase fuel loads for fires, turning them into fire starters in vulnerable areas.
For SMEs, these trends translate into greater risks of property damage and operational disruptions during peak seasons.
Preparing for these events is essential. Whether you run a café in a bushfire-prone area or manage a farm in a drought-affected region, building resilience begins with understanding your risk exposure. Check out the Climate Risk Map of Australia, thanks to the Climate Council.
Rainfall Variations Are a Double-Edged Sword
Australia is facing drier conditions in the south, putting more pressure on agriculture and urban water supplies, says Australian Geographic. In contrast, the north is experiencing a 20% increase in heavy rainfall since 1994, heightening flood risks.
Floodwaters can do more than disrupt supply chains—they’re also a breeding ground for invasive fish species, known to damage aquatic ecosystems and coastal fisheries. For SMEs relying on marine or freshwater resources, this poses a unique operational risk.
Both extremes of dry and wet can cause significant disruption to businesses, from property damage to lost revenue from supply chain interruptions.
For SMEs in agriculture, tourism, or manufacturing, these shifts demand adapting to fluctuating water availability and preparing for potential extreme weather events. Reviewing your insurance policies to ensure coverage for flood damage or crop loss is a prudent measure.
Sea levels around Australia have risen by 22 cm since 1900, while marine heatwaves continue to disrupt coastal infrastructure and ecosystems. For SMEs operating near the coast, this translates to increased vulnerability to storm surges, coastal erosion, and damage to marine-based operations.
Tailored marine and coastal insurance options address these specific risks, offering peace of mind as these challenges escalate. We work with you to ensure your policy reflects your business’s unique location and needs.
How Climate Change Is Driving Premium Increases
With extreme weather events becoming more frequent, insurance premiums are rising across the country. Higher claim rates from bushfires, floods, and other disasters are contributing to these increases, which are hitting record highs. This makes proactive risk management essential.
As your broker or adviser, we identify areas where your coverage may need updating and suggest cost-effective strategies to lower premiums, such as investing in property protection measures or diversifying risk exposure.
Practical Steps to Protect Your Business
Building resilience to climate risks begins with identifying your vulnerabilities. Climate risk mapping tools allow you to evaluate your property’s exposure to fire, flooding, and rising sea levels. Once you’ve assessed the risks, we guide you in updating your insurance policies to suit your business needs.
Proactive steps include:
- Diversifying your supply chains
- Tapping into government grants and tax incentives to invest in sustainable sources and practices, such as energy-efficient equipment, waste reduction initiatives, solar panels, water tanks, etc.
- Securing your property against extreme weather, reinforcing structures, clearing gutters and installing fire-resistant landscaping if you’re in a bushfire-prone zone
- Using the new BOM weather app to better prepare for severe weather events
- Developing a business continuity plan to help protect your physical and digital, and
- Partnering with us, as your broker or adviser, for tailored advice
Why Partnering with a Broker or Adviser Matters
Navigating the complexities of climate risk can feel overwhelming. As your broker or adviser, we provide expert insights into specialised insurance solutions tailored to your business challenges. From bushfire and flood coverage to business interruption insurance, we ensure you’re prepared to face Australia’s changing climate with confidence.