NIBA has welcomed the Productivity Commission’s draft report into Natural Disaster Funding Arrangements, saying it is pleased the body recognises that national insurance markets price risk correctly.

As reported by Insurance Business last week, the commission has called for higher levels of financial support to mitigate the risk of natural disasters for communities, and the reduction of expenditure on post-disaster support and reconstruction.

NIBA CEO Dallas Booth said that the interim report was wholly consistent with the views NIBA, which it had submitted to the Productivity Commission Issues Paper on Natural Disaster Funding Arrangements in June. It also welcomed the findings that insurance markets for natural disaster risk in Australia are generally working well, with risk being priced down to individual property level.

Booth said body is also pleased the commission recognises the greater role governments can play in mitigating risks.
"The insured losses are occurring in the built environment. However, the location, nature and use of buildings is controlled by governments and government agencies. It is therefore pleasing to note that this report acknowledges that government has a greater role to play in mitigating these risks and increasing community resilience when disasters strike."

Emphasising the role of the broker, Booth said as it can be difficult or consumers to find suitable insurance cover at affordable rates in high-risk areas, consumers, property owners and business owners should seek risk and insurance advice from a qualified insurance broker.
"Insurance brokers have extensive experience in helping clients identify, assess, manage and finance their risks," said Booth. "They are able to provide expert guidance and support on a wide range of risk financing strategies, using products and financing packages from Australia and the worldwide insurance markets."