Extreme weather losses in Australia costs insurers $3.5bn in 2025: ICA

New data released by the Insurance Council of Australia (ICA) shows that the total cost of extreme weather events that impacted Australia throughout 2025 resulted in almost $3.5 billion in insured losses, stemming from 264,000 claims.

A breakdown of these claims shows that the costliest event of 2025 was Ex-Tropical Cyclone Alfred, in March, which accounted for 132,000 claims and more than $1.5 billion in insured losses.

Data from the ICA also shows that severe hailstorms that took place over five weeks in October and November left similar damage bills as Alfred.

“Last year saw five events declared significant or catastrophic by the Insurance Council, including the North Queensland Floods in February, Ex-Tropical Cyclone Alfred in March, Mid North Coast floods in May, and two Severe Storm events in October and November,” the ICA said.

The Severe Spring Storms that affected South-East Queensland and Northern NSW from late October to early November led to insured losses amounting to $601 million across 35,500 claims.

In late November, the two states experienced more intense storms and hail, resulting in an additional 70,200 claims and $814 million in insured losses. Cumulatively, the losses from these two events amounted to $1.4 billion.

Further data shows that the January/February North Queensland floods incurred losses of $304 million from 11,700 claims, while the Mid North Coast and Hunter floods in May added 14,500 claims and $266 million in losses.

As per the ICA, other, more locally severe events included flooding in Western Queensland, storms in Casterton and Harden, as well as bushfires in Halls Gap. However, due to the smaller scale of these events they are not included in the published data.

“Insurers expect further claims will be made from these events, meaning the eventual cost of extreme weather in 2025 will grow,” the ICA explained.

Adding: “In comparison, insured losses from extreme weather events in 2024 totalled $581 million and from 2023 totalled $2.35 billion, demonstrating the unpredictable nature of extreme weather year on year.”

To help support communities in their recovery throughout 2025, the ICA coordinated three insurance hubs in the immediate aftermath of events and 13 community consultation sessions.

The ICA also highlighted that the first few weeks of 2026 have already seen significant extreme weather activity, ranging from bushfires in Victoria to monsoonal weather in North Queensland.

“Insurers are prioritising claims from these events and are supporting communities in their recovery, with many insurers maintaining strong on-the-ground presence across parts of Victoria,” the ICA concluded.