Australian Banking Association chief executive and former Queensland Premier, Anna Bligh has flagged governments drastically need to address future proofing communities at high risk of disaster.

Ms Bligh told The Canberra Times during the ABA's inaugural banking conference the increasing frequency of natural disasters should prompt a more urgent response to prioritising investments to mitigate damage risks.

"We have had two years with the biggest bushfires and now the largest scale floods," she said.

"It is time for us to put the thinking cap on and think drastically differently about how we work with these communities.

"We got to put everything on the table. From land buybacks where appropriate, to water storages and levees."

During the summit, Ms Bligh highlighted that only three cents of every dollar spent on natural disasters is put towards mitigation strategies.

She noted heightened levels of disaster risk would fundamentally change the matrix to whether a bank would provide finance for a property, or if housing insurance is even viable.

"Houses are the assets that secure the mortgage," Ms Bligh said.

"That's how the banking system works. And if those assets are going to be repeatedly damaged to the point where it affects the values of those assets, then we've got to think differently about how we accommodate that risk."

READ MORE:

Latest Commonwealth figures show $565 million in disaster payments had been distributed by Services Australia to 490,000 flood victims.

The fallout from the floods has also cast divisions between the federal and state governments, following accusations it was the premiers fault for not acting fast enough to declare the floods a national emergency.

Prime Minister Scott Morrison and the federal government have been criticised for not enacting an emergency declaration earlier.

Emergency Response Minister Bridget McKenzie said the delay was due to the threshold of what determines a natural disaster not being triggered earlier.

"There's actually a threshold trigger for calling a national disaster," Senator McKenzie said on the Today Show.

"So it was the compounding nature of this natural disaster that allowed the threshold to be met for us to be able to (make the) call."

Since the 2011 Queensland floods, the sunshine state has had over 90 declared natural disasters.

Westpac chief executive Peter King who also spoke at the ABA conference, agreed there needs to be imminent policy response by government to deal with climate change and mitigation strategies.

"We will need to invest in the quality of housing, in mitigation whether it be flood or fire ... and that is where we need policy," he said.

ANZ has pushed up its inflation forecast as a result of the floods and the Ukraine crisis more broadly impacting commodity prices.

The bank claims annual inflation could soar by 5 per cent in the first half of 2022, with food prices likely to be impacted by flooding damaging crops.

Close to $1.8 billion in damage claims has been lodged to insurers as a result of the flooding affected Queensland and NSW.