PERILS has released an initial industry loss estimate of $786 million for the January 2026 Victorian bushfires, marking a significant catastrophe event for Australia’s general insurance sector. The Zurich-based catastrophe data provider said the figure is based on loss information submitted by affected insurers and, in line with its Australian coverage definition, is limited to property and motor hull lines.
The bushfires burned across Victoria between Jan. 7 and 13, 2026, mainly in rural districts, affecting about 400,000 hectares. Authorities have reported one fatality and widespread damage to homes, farming assets, and local infrastructure. PERILS intends to issue an updated industry loss number on April 13, 2026, three months after the event end date, following its standard reporting timetable and incorporating more mature claims data.
PERILS product manager Luzi Hitz said the event sits within a broader pattern of wildfire and catastrophe activity in the state. “Victoria has suffered two major wildfire disasters in recent years, the ‘Black Summer’ event of 2019/20 and the ‘Black Saturday’ event of 2009, the latter causing 173 fatalities. This time the death toll was much lower, in part due to the bushfires impacting less populated areas, but also due to the rapid declaration of a state of emergency, early evacuations, and extensive firefighting efforts which undoubtedly helped to save lives,” Hitz said. He said that “after six years of mainly ‘wet’ Cat events in Australia, including floods, cyclones, and severe convective storms, the 2026 Victoria bushfires serve as a reminder of the significant bushfire risk in Australia.”
Earlier in the loss development, the Insurance Council of Australia (ICA) provided an initial market-wide view of the impact. As at Jan. 28, 2026, the ICA reported more than $200 million in insured losses from the Victorian fires, across 3,123 lodged claims. Those claims span home and contents, motor, commercial, and business interruption policies. The ICA said around 30% of property claims at that point were assessed as total losses, indicating a high share of complete structural damage in the property segment.
Government representatives have pointed to insurance as a central mechanism for recovery in fire-affected communities. Federal Member for Bendigo Lisa Chesters said insurers and other service providers have been part of the early response in impacted local government areas. “I’m grateful for the support of organisations and service providers are showing fire-affected community members across the Mount Alexander Shire. As residents pick up the pieces from this catastrophic event, the government is working collaboratively with councils and service providers to assist those who have been impacted,” Chesters said. She said insurance capacity and claims outcomes will influence how quickly regional centres such as Ravenswood and Harcourt can rebuild. “Insurance will play such a big part in our community’s recovery. It was so critical to have insurance industry representatives on ground and meeting people face to face within days of the Ravenswood/Harcourt fire,” she said.
The Victorian fires have also renewed discussion about the cost and availability of cover in locations with elevated exposure to bushfire and other natural perils. Castlemaine-based lawyer Zoe Edquist arranged a review of her elderly parents’ home policy shortly before the January event, increasing the sum insured. A subsequent grassfire destroyed the property, which has been declared a total loss. The claim proceeds are expected to fund a rebuild, although the family does not anticipate a full replacement of all contents and improvements.
Edquist told ABC that the experience has reinforced her concerns about how premiums and insurability may evolve in hazard‑prone regions. She described the affordability of cover in future years as a “real worry” and warned that current premium and risk trends “may also result in a lot of properties being uninsurable, and that’s not just here, but anywhere that’s got a realistic risk of flood or fire.” She has proposed options such as targeted government subsidies or allowing premiums for high‑risk properties to be deducted from taxable income, with the objective of sustaining coverage levels as insurers continue to apply risk‑based pricing.
