After adjusting the Insurance Council of Australia’s Disaster List for 2006 societal conditions, we estimate Australia’s average annual insured loss due to natural perils to be around $1 billion. Worldwide, the costs of natural disasters are increasing (Swiss Reinsurance Company, 2006) leading to concerns that human-induced climate change is contributing to this trend. The authors demonstrate that demographic and societal changes are overwhelmingly responsible for the increasing costs of natural disasters in Australia. While there is no guarantee that this situation will continue, the authors proffer the case for increased efforts and policies aimed at reducing the vulnerability of communities to natural hazards. Any gains in disaster risk reduction made will stand Australia in good stead now and into the future.