Victoria is set to implement a new flood hazard rating system designed to provide more detailed information about flood risks to communities, developers, and insurers.
The initiative, led by the state government, aims to support more informed planning and construction decisions by classifying flood risk levels from “low” to “very high.”
This approach is modelled after the bushfire danger rating system and will be integrated into updated planning and building controls.
The government’s objective is to ensure that new homes and infrastructure are constructed with the latest flood modelling in mind. The new system is expected to replace the current practice, where insurers often apply uniform premium increases across entire communities, regardless of whether only certain areas are at higher risk.
Minister for Water Gayle Tierney said the changes are “about protecting lives and property where the risk is greatest, while making it easier to build homes and businesses in low risk places.”
Minister for Planning Sonya Kilkenny added that the government is “providing better information and more clarity to councils, industry, and communities, so we can manage flood risks while building the homes that Victoria needs.”
Minister for Housing and Building Harriet Shing added: “We are ensuring building standards protect consumers and deliver high-quality houses in the right places so that as Victoria grows, we are supporting consumers by managing and mitigating the impacts of climate change.”
The new flood rating system is expected to provide more precise data for insurers, potentially leading to more tailored premium calculations.
By distinguishing between varying degrees of flood risk, the system aims to improve transparency for both households and insurers.
Areas identified as very high risk will face development restrictions, while moderate- and low-risk zones will have requirements scaled to the assessed hazard level.
Melbourne Water, in collaboration with Catchment Management Authorities, will oversee the rollout of updated flood maps for Greater Melbourne over the next two years.
These maps will be incorporated into local planning schemes, and any new developments or significant renovations will be assessed using the latest flood data.
The process is intended to reduce administrative demands on local councils, as the state government takes a more active role in flood risk management.
Victoria’s move comes amid heightened attention to flood risk and insurance affordability nationwide.
Some homeowners have reported insurance quotes as high as $30,000 per year following the reclassification of their properties.
Residents have raised concerns about the accuracy of the new flood risk assessments, while the council has noted that it does not control insurance pricing.
A recent report from Climate Valuation projected that by 2030, over 500,000 Australian homes could be at high risk of becoming uninsurable for flood damage. The report identified several suburbs, including Tweed Heads South and Chinderah, where more than 80% of properties face this risk.
