Cyclone preparation and management

Australia is one of the most significantly impacted countries by cyclones, however a relatively quiet tropical cyclone season in the western Pacific Ocean in 2021 brought significantly lower losses than previous years.

However, with the long-term average number of Australian tropical cyclones per season reaching eleven (with four typically making landfall), this undoubtedly has a significant impact on business.

Impact on business

Cyclones 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. Cyclones are often accompanied by a large amount of rain which can also lead to flooding and water damage.
Since 1980, the percentage of tropical cyclone-related damage globally has been 31 per cent. This means that 69 per cent – or USD1.1 trillion – of global storm damage was uninsured, meaning large pay outs for businesses and communities.  
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 organisations should do to prepare

Organisations in cyclone-prone regions should have a plan in place to minimise the 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.

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 can get your business running and generating revenue as quickly as possible.

For more information on how Aon can help your organisation to manage severe weather risk, please contact a risk consultant.

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