Tools & Tips to Handle Summer Weather Risks Effectively

Australia is heading into a high-risk summer, with hotter days, warmer nights, and more rain than usual expected across much of the country. Over the past year, we’ve already seen more than 80 severe weather events. Emergency agencies say flood, storm, and bushfire risks could jump by as much as one third in some regions. Warmer oceans are supercharging storm systems, and fast-drying ground across NSW, Queensland, and Victoria is setting the stage for quicker, harder-to-predict fire behaviour.

How Severe This Summer is Looking

The Bureau of Meteorology expects both day and night temperatures to be unusually elevated. More than four in five regions face higher-than-average overnight heat. Rainfall has been inconsistent; some areas are soaked, while others are drying fast, which tends to create stop–start bursts of risk. Parts of the nation’s east should expect above average-rainfall; the west, below average.

Bigger fuel loads in Victoria, Queensland and along the east coast mean grass and scrub fires can take hold quickly. Storms have already driven about 126,000 insurance claims this year, costing close to $1.5 billion. Losses from the first half of 2025 have already topped $1.8 billion and continue to rise. Secondary perils are the everyday extreme events that hit more often; things like sudden flash floods, intense summer heatwaves, hailstorms and fast-forming storm cells. They don’t always make headlines like cyclones or bushfires, but together they now cause far more damage across Australia. These events strike with little warning, affect built-up areas, and put pressure on drainage, power, and older buildings.

In some hotspots, the risk is so frequent and severe that insurers price it higher or limit what they can cover, simply because the losses keep rising faster than the system can absorb.

Insurance Costs Keep Climbing

Insurers are making big changes as climate risks rise. Pricing is becoming more fine-grained, and high-risk areas or industries are feeling the squeeze. Construction firms are seeing higher excesses; retail and hospitality are facing stricter conditions; and professional services firms are being asked for clearer evidence of continuity planning.

About three in five major weather events now lead to business disruption long after the physical clean-up is over. Experts also say Australia is facing a $4.5 billion insurance crisis, with one in six businesses unable to secure cover that genuinely matches their risk and cashflow.

Affordability and Underinsurance Pressures

The latest Insurance Council of Australia data shows more than half of Australia’s local government areas now face either high or very high exposure to extreme weather. For SMEs this often means more conditions in policies, larger excesses, and sometimes unexpected gaps.

Industry data suggests about seven in ten businesses are underinsured, with an average shortfall of roughly 30 percent across property, equipment, and other assets. Up to four in five businesses never fully recover after a major event when insurance cover proves inadequate.

What SMEs Can Do Right Now

Heat, heavy rain, and sudden storms affect every industry. Practical steps like these help reduce risk and strengthen your resilience:

• Protect people first: Review heat protocols, storm-safe procedures and communication plans
• Check critical equipment: HVAC, roofing, drainage, backup power and batteries
• Review site exposure: Outdoor areas, signage, storage, vegetation and firebreaks
• Confirm supplier continuity: Transport, logistics, backup providers and cloud systems

• Check coverage accuracy: Make sure sums insured reflect current rebuild costs
• Review business interruption triggers: Know what is covered and what is excluded
• Document risk controls: Insurers expect clear proof of maintenance and planning

Early action really matters. Nearly half of Australia’s small and medium businesses are underinsured by at least 20 per cent, and rising building and replacement costs mean gaps widen quickly if values aren’t reviewed regularly.

Staying on top of maintenance, valuations, and continuity planning helps keep your business operating during a tough season. If you’d like a practical check of your insured sums, policy details, or continuity plan, BICS can help you close any gaps before summer peaks.

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