Queensland government announces new insurance funding for natural disasters

Queensland government announces new insurance funding for natural disasters | Insurance Business Australia

Queensland government announces new insurance funding for natural disasters

The Queensland Government has announced new insurance funding for natural disasters in areas ranging from Bundaberg to the Northern Territory border.

Deputy Premier Steven Miles stated on Wednesday that the $10 million funding aims to lower the cost of insurance in the region. The grants are available to 33 councils and the Weipa Town Authority in high-risk, cyclone-prone coastal areas within 50 kilometres of the coastline to “reduce the impacts of natural disasters” while making insurance affordable, according to 7News.com.au.

However, not everyone was pleased with the funding. For example, Townsville Chamber of Commerce chief executive Ross McLennan claimed that stamp duty is the key issue for insurance premiums in the state.

“If they’re fair dinkum about insurance premiums, they’d change their levy on stamp duty,” McLennan told the Australian Associated Press.

The Australian Competition and Consumer Commission’s (ACCC)  northern Australia Insurance Inquiry first interim report in December 2020 backed McLennan’s comment, proposing scrapping stamp duty on insurance products, banning commissions for insurance brokers, and applying unfair contract terms protection to insurance products in northern Australia to promote insurance affordability in the area.

Read more: PERILS releases final insured loss data for SE Queensland hailstorms

In North Queensland, residents have been calling for insurance funding for natural disasters since the beginning of 2021 because many of them were suffering from underinsurance as frequent floods, cyclones, and other emergency events resulted in rising insurance premiums.

In a statement published in March, Federal MP Bob Katter suggested expanding the Commonwealth’s terrorism reinsurance scheme to encompass state-of-emergency events such as those in the region.    

“I want us to not to have to pay $4,000 for house insurance every year in north Queensland, especially when the rest of Australia is paying $1,500,” Katter said, as reported by The Bull. “I made it perfectly clear to the prime minister that I have strong feelings about the necessity for a reinsurance pool for northern Australia.”