Changes could make insurance more affordable
UNAFFORDABLE insurance policies could soon become a thing of the past thanks to a strata building resilience project undertaken by CGU Insurance.
The project will start in midApril and focus on improving building resilience to severe weather so that customers can receive sustainable premium reductions.
CGU’s wholly-owned subsidiary Strata Unit Underwriters (SUU), which currently insures a substantial number of residential strata properties in North Queensland, will oversee its implementation.
Under the project, CGU will fund building risk assessments undertaken by specialist building consultants Sergon, across all of the residential strata properties that SUU and CGU insure in North Queensland. The assessments will cover risks such as building construction type and method and exposure to direct wind-driven rain, as well as other hazards and possible defects.
Following completion of each assessment, CGU will revisit its pricing, with a view to reducing premiums where possible.
CGU chief executive officer Peter Harmer said he understood and empathised with the needs and interests of customers and North Queensland communities.
He said until the surveys were completed, it was difficult for CGU to estimate the size of potential premium reductions but early stage high-level calculations suggested individual premium reductions of up to 25 per cent.
Airlie Beach resident Margaret Shaw, who has been at the forefront of a three-year campaign to lower exorbitant insurance costs, said this was a fantastic initiative that she hoped would be the first of many.
“This means proper risk assessment rather than postcode location risk assessment and obviously CGU are acknowledging we do have a problem,” she said.
Federal MP Warren Entsch, who is the chair of the bi-partisan select committee for northern Australia, said insurance was an issue that had come up on the committee’s current tour.
“If this insurance disaster is not fixed it will stifle opportunities for growth,” he said.
“The insurance companies are on notice and if they don’t fix it we will legislate – there’s no doubt about that.”