Flood risk assessment and management

La Niña brought amplified rainfall to Australia in 2021, with record rainfall observed across eastern Australia in March and November.

In March 2021, a low-pressure trough formed along the eastern seaboard of Australia, covering some 1,200 km of north-south length, causing prolonged rainfall and flooding along the eastern seaboard of Australia. While not an uncommon weather pattern for this time of year, two factors contributed to the heightened flood risk. The first was that this event occurred at the end of a wetter-than-usual summer period driven in part by La Niña. The second was the stationarity of this event, with heavy rain persisting for four to five days.

As floods become more and more severe, they increasingly threaten lives, property and critical infrastructure. With power outages, broken communication lines and disruptions to road, rail, sea and air transportation being common in the aftermath of major storms, this can significantly impact everyday lives and businesses.

Impact to your business

Floods can wreak devastating damage to your business property or destroy it completely, and can stop your business from running and amount to a large cost to the business.
During severe weather, staff may have difficulty returning to work (whether it is to attend to their own properties or families, or through limited access to transport), pre-arranged offsite centres may face excess demand, and tradespeople will likely be at a premium. Even with agreed fixed prices and service level agreements, in a time of disaster, essential services become hot property, and so access to them can become a challenge. Claims may also take longer than anticipated to be paid, thanks to pressure and demand on the insurers.

What should you do to prepare

With increased preparation, these damages can be significantly reduced. Organisations should have a plan in place to minimise flood risk and the impact to their business. As well as having your assets valued and having insurance and business continuity plans in place, organisations should also have a flood mitigation plan ready to go.
Flood mitigation plans help businesses to prepare for and recover from a flood. While we clearly need to ensure all exposed properties and neighbourhoods are resilient to flooding, businesses also need to plan and prepare themselves to be quickly up and running after a flood, if only to provide themselves with a distinct competitive advantage.
If an organisation’s operations are within a flood prone area, it is important that they remain vigilant of Bureau of Meteorology alerts, while also having a defined flood zone have a prepared flood mitigation plan. It’s critical to consider the consequences of being unable to operate for a period-of-time, including the impact on their bottom line. Businesses should also consider continuing repercussions from floods, as operations may not return to normality for some time.
Finally, tenants of leased premises should also connect with their landlords or building managers regarding flood response planning ahead of an event. This will ensure that any preventative measures are aligned with the site’s overall response plan and capabilities.

How Aon can help

Aon can help you identify your severe weather risks and come up with a plan to manage and reduce them. We provide a full suite of end to end solutions that can help you before, during and after a weather event.
We can help you:

  • Identify risks and reduce the frequency and impact of a loss
  • Accurately quantify your risks
  • Ensure your tangible assets are valued correctly
  • Find the appropriate insurance cover for your property and business interruption

Devise a business continuity plan to ensure you

Aon’s solutions

Business continuity management


Risk control and engineering

Analytical services

Claims consulting

Other Resources

Make a Claim

Flood Mitigation Plan