Along with accidental damage, weather-related damage accounts for the most significant proportion of claims among Argis farm insurance policyholders.
But while the damage caused by bushfires – such as those we experienced in the horrific summer of 2019/20 – is well-documented, Argis farm underwriting manager Peter Morsley says that bushfire is seasonal and a less regular event than its biggest weather loss driver – being storms.
“Although bushfires can be devastating when you have an event, a more significant portion of our claims come from storms, whether they be significant storm events or just day-to-day storms. Even an isolated storm can result in large claims in a confined geographical area,”Mr Morsley said
With structural damage to commercial and residential farm buildings being the most common weather-related claims type in the Argis portfolio, Mr Morsley says the damage can also be caused by rain, hail and wind events.
Ingress claims from water entering through roofs or as a result of gutters overflowing during heavy downpours, roofing damage due to strong winds and hail, and vehicle damage caused by hail are all common claim occurrences.
Mr Morsley confirms that weather-related losses are having an impact on premiums in the farm insurance market, with most underwriters raising rates to account for weather loss experience – but rates are also increasing due to the widespread losses from the recent bushfires.
The Bureau of Meteorology recently declared a La Niña climate system has developed, which is likely to last until at least the end of 2020.
La Niña is typically associated with above-average rainfall and an increased risk of damaging storms, flooding and tropical cyclones. The last significant La Niña in Australia in 2010-11 was Australia’s wettest two-year period on record and notable for the Brisbane floods.
Mr Morsley says that the La Niña could be something of a “double-edged sword” for farmers.
“La Niña is crucial to ending the drought – we’ll likely get a lot of rainfall and that would be good for farmers, but it’s also associated with an increased probability of larger and more frequent storm events so we’d expect to see above average storm damage and weather-related claims during that period,” he says.
Ways to minimise weather damage
Mr Morsley says to prevent or minimise damage from storms, farmers should ensure their buildings – both domestic and commercial – are regularly inspected for damage or deterioration, and are well maintained and repaired when necessary.
He says checking for cracked roof tiles, or loose sheeting in the case of iron roofing, damaged or deteriorated timber posts, and keeping gutters clear, are especially important.
“If a farm has a weather event, even if the policyholder doesn’t think they’ve sustained any damage, it’s always wise to undertake a check,” he adds. “Something may have cracked slightly or become dislodged that could lead to more significant damage in the next major storm.”
In the case of bushfires, Mr Morsley says that having firebreaks around the property – particularly if it’s located near national parks or areas of dense bushland – keeping vegetation cleared around buildings and keeping gutters clear are the most effective things property owners can do to minimise the risk associated with ember attacks.
But, he adds, sometimes damage is unavoidable. “There will always be weather events where it doesn’t matter how well maintained a property is, it’ll either be very strong winds or a lot of rain or hail or a bushfire, which you just can’t do anything about.” These are the times you need your insurers to support you.
Kosta Biris, Head of Claims at HDI Global Specialty SE Australia, the insurers of the Argis Farm insurance policy says, “we strive to consistently deliver on our promise to our clients and to provide them with certainty in uncertain times. In the event of a loss, please follow the instructions on how to make a claim that you will find in your policy documentation. However, if you have any queries a member of our Claims team will be happy to assist you.”