Actuaries Institute calls for AI, climate, and healthcare reforms

Five major areas for policy action recommended for 2025-26 budget

Actuaries Institute calls for AI, climate, and healthcare reforms

Cyber

By Roxanne Libatique

The Actuaries Institute has outlined key policy recommendations in its 2025-26 Pre-Budget submission, urging the federal government to implement measures that enhance economic stability and social equity.

The submission identified five major areas for policy action: 

  1. continuing targeted cost-of-living support
  2. increasing investment in climate resilience and emerging technologies such as artificial intelligence (AI), cyber security, and quantum computing
  3. reforming healthcare funding, the retirement income system, and disability and rehabilitation programs
  4. addressing tax policy challenges, particularly in relation to superannuation and wealth distribution
  5. expanding education investment to strengthen the future workforce in science, technology, engineering, and mathematics (STEM) and improve financial literacy

“Australia faces complex economic challenges that require a measured, evidence-based approach balancing immediate economic pressures with long-term strategic planning to safeguard our nation’s economic stability and social fairness,” said Actuaries Institute CEO Elayne Grace.

Grace said ensuring targeted cost-of-living support is important, but there is also a need to invest in climate resilience and advancing AI technologies.

Investing in climate resilience

Actuaries Institute’s calls for investing in climate resilience bring to light the Insurance Council of Australia’s (ICA) 2024 edition of its “Climate Change Roadmap,” which outlined how insurers are working toward emissions reduction and climate risk mitigation.

The report detailed industry commitments, with 85% of ICA members setting a net-zero target for 2050 and 50% aiming for operational net-zero by 2030. The survey also found that 63% of insurers have integrated climate-related performance metrics into executive compensation structures.

Advancing AI

Meanwhile, the institute’s calls for improving AI align with the findings of GlobalData’s 2024 Emerging Trends Insurance Consumer Survey, which revealed that AI, cyber risk management, and environmental, social, and governance (ESG) factors will play a growing role in the Australian insurance market in 2025.

The study indicated that 43% of global consumers are comfortable using AI-driven tools for insurance premium calculations. It also highlighted the growing demand for personal cyber insurance, with 26.4% of consumers expressing interest in the product. Among younger consumers aged 18 to 24, interest rises to 36.7%, suggesting a potential growth market if insurers can balance pricing with risk management.

Call for end to GP fee ban

Another key area that the institute wants the government to consider is reforming healthcare funding, bringing to light the Members Health Fund Alliance’s calls for lifting restrictions preventing private health funds from covering general practitioner (GP) out-of-pocket costs.

Data from Money.com.au revealed that out-of-pocket costs for Australians with private hospital insurance have risen by 71% over the past five years, growing at a faster rate than other healthcare expenses.

Between 2019 and 2024, disclosed out-of-pocket payments increased from $99 to $135, while undisclosed costs rose from $418 to $685. In contrast, hospital service costs grew by 22%, Medicare rebates by 18%, and private insurer contributions by 12%. Private health insurance premiums also rose by 15.1% in the same period.

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