Queensland budget not enough to protect Australians from natural disasters – ICA

Peak body highlights underinsurance problem

Queensland budget not enough to protect Australians from natural disasters – ICA

Insurance News

By Roxanne Libatique

The Queensland government has announced a $10 million budget for household resilience and mitigation measures. However, the Insurance Council of Australia (ICA) claimed that the budget was not enough to protect Queenslanders from extreme weather events.

The ICA stated that the $3 million to be spent by the government on new household resilience funding from 2021 to 2022 fails to confront the enormity of the challenge to make Queensland homes and businesses more resilient to natural disasters.

ICA chief executive officer Andrew Hall said the insurance industry had been calling for some time for greater investment in resilience and mitigation measures.

Queensland’s Household Resilience Program helped eligible homeowners in coastal parts of the region improve their homes’ resilience against cyclones. However, the government did not renew the programme despite its success, leaving many without support for much-needed home building mitigation.

The new $20 million Queensland Betterment Fund, jointly funded with the Federal Government, aims to reduce the cost of future reconstruction of public assets damaged by natural disasters. Other natural resilience and mitigation funding in the budget comes from the Queensland Resilience and Risk Reduction Fund, also jointly funded with the Federal Government, which is expected to expend $14.4 million from 2021 to 2022.

“The Federal Government’s recent allocation of $600 million over five years for new disaster preparation and mitigation programmes and $40 million to make strata buildings in northern Australia more resilient to extreme weather potentially unlocks significant partnership investments with the states,” Hall said.

According to the ICA, the “ongoing failure” to address stamp duty on insurance means underinsurance will continue to be an issue in the state, which has the most significant exposure to the impacts of natural disasters.

“Queensland should be looking to maximise these opportunities,” Hall said. “More resilient communities, businesses, and households mean less disruption to life and faster recovery after a major natural disaster.

“On the revenue side, stamp duty on insurance remains a retrograde measure that numerous inquiries and reviews have found leads to household underinsurance or non-insurance.”

The ICA urges all state and territory governments to advance tax reform and remove stamp duty on insurance products to increase insurance affordability for all Australians.

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