Govt ‘failing body corps’
A NATIONAL Insurance Advisory Council is not the answer to the failing strata insurance market in Far North Queensland, according to Archers Body Corporate Management .
Following an inquiry into the strata market, the Federal Government announced an advisory council which has so far largely ignored the recommendations put forward.
Archers managing director Colin Archer said an RP Data search revealed over 55 per cent of units sold in the December quarter in North Queensland were below their acquired cost, making it Australia’s worst performing property segment.
‘‘There are two companies offering policies for new insurance, one is Longitude, a Suncorp subsidiary that insures up to $15 million leaving Strata Unit Underwriters the only company good enough to stay in the market for larger buildings,’’ he said.
‘‘If they pull out there’s no one to insure the buildings and they keep saying they are running out of capacity.
‘‘This is clear evidence there’s a market failure problem and this is where governments are meant to help.’’
Mr Archer said because North Queensland is paying at least 10 times more than the southern areas on body corporate insurance, it means they are also paying 10 per cent more taxes on the state’s stamp duty and federal GST than people living in Brisbane.
‘‘I don’t see why the Government can’t put a stop on that and make it fairer but that was two recommendations in the report not given the time of day,’’ he said.
‘‘ Another recommendation was to demand the 20 companies who offer strata insurance in Australia to offer their products across Australia, but the insurance council is opposed to that because it’s not free trade.
‘‘The biggest recommendation was to investigate the expansion of the Australian Reinsurance Pool Corp.,