Toll From Tempest Surges Over $2bn

Newcastle Herald

Monday June 2, 2008

By JASON GORDON

THE full cost of last year's devastating Pasha storm has almost certainly passed the $2 billion mark with a new report showing the extent of under-insurance, business revenue losses and flood-related job losses.

Hunter Valley Research Foundation (HVRF) will this morning release the findings of its anticipated research into the June 8 storm and subsequent flooding.

Among the key findings of the study, titled Rising Waters: An Assessment of the Economic and Social Impacts of the 2007 Pasha Storm:

? 240,400 Hunter people were left negatively affected by the storm;

? $364 million worth of damage was caused to uninsured property;

? $1.3 billion worth of damage was caused to property, excluding public-owned infrastructure; and

? 1170 jobs were lost through businesses not recovering from the storm.

The Insurance Council of Australia has so far received 102,000 claims from storm-affected policyholders worth $1.48 billion. With damage to uninsured property put at $364 million, business revenue losses put at $370 million, and 1170 job losses, the true cost of the storm has washed well beyond $2 billion.

HVRF co-director of research Robin Mcdonald said yesterday that while the foundation's research put the total damage bill in the Hunter at $1.3 billion, it was a "very conservative" figure because it only took damage in the Hunter into account and excluded damage to public infrastructure such as roads, bridges, parks and levees.

"It's also very hard to put a price on the loss of life and injury," Ms Mcdonald said.

The number of job losses was also a conservative figure, she said.

Among the social impacts, 172,650 Hunter people, or 29 per cent of the region's population, experienced stress or inconvenience as a result of the storm at home, a further 99,000 experienced the same while at work with a further 116,000 experiencing the same while stuck in cars or in other public places. The figure includes the estimated 15,000 people who were evacuated from their homes.

Of the $364 million worth of damage caused to uninsured property, Ms Mcdonald said the vast majority of it was caused to private property.

"It was not surprising that workplaces were better insured [than private property owners], but that might also be a consequence of people having to tighten their belts or not being able to afford insurance [on their homes and cars]," she said.

A quarter of the 1865 Hunter residents surveyed said they had experienced difficulties with their insurance company.

"It's difficult to point the finger at insurance companies because many people were under-insured or weren't certain of what they were actually covered for," Ms Mcdonald said. "But our figures certainly suggest that there were a lot of people who were unhappy."

On a more positive note, the research also found that about 18,800 people benefited from the storm. Those benefits related to renovations or improvements to their homes, or to the replenishment of water for crops and stock.

Also among those to benefit were an estimated 2200 Hunter businesses who reported an upturn in trade. They operated mainly in the construction, cleaning and car industries.

THE FINDINGS

* Damage to property that was not

insured is estimated at $364 million.

* Total damage bill in the Hunter,

excluding the Central Coast and

excluding damage to public infrastructure

such as roads, bridges and

drains, is conservatively estimated at

$1.3 billion.

* Estimated cost of damage to homes

is $400 million.

* Estimated cost to workplaces is

$458 million.

* Estimated cost of damage to places

other than homes or workplaces,

such as cars, is $92 million.

* Loss of revenue at businesses

affected by the storm is estimated at

$370 million.

* An estimated 1170 jobs were lost

through businesses failing to recover

or re-open after the storm.

* 25% of people said they had

difficulties dealing with their

insurance company.

* 29% of all Hunter residents experienced

stress or inconvenience at

home as a result of the storm, while

17% suffered stress or inconvenience

at work.

* In total, 240,400 Hunter residents

said they were negatively affected by

the storm in some degree.

* An estimated 121,380 people reported

property loss or damage to their

homes. Of those, 15,300 experienced

severe damage.

* About 18,800 people reported

positive impacts after the storm. The

benefits related mainly to home renovations

or improvements, or having

increased water for crops and stock.

* About 2200 Hunter businesses

benefited from reconstruction work

and flood clean-up.

© 2008 Newcastle Herald

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