Insurers say mitigation key to costs

INSURERS have defended high home insurance premiums in the Far North, saying allegations of “gouging” have been repeatedly disproved.

The Insurance Council of Australia has blamed the risk of cyclones for higher premiums, which have been investigated by the Australian Government Actuary three times.

ICA’s general manager for communications and media, Campbell Fuller, said the three independent reports concluded insurers were pricing fairly and not ripping off North Queenslanders.

“Despite this, the market remains highly competitive on price and on policy features,” he said.

But Member for Barron River Craig Crawford, who received a $3500 quote in the mail, said premiums were “absolute highway robbery”.

“The reality is we are paying ridiculous amounts for insurance,” he said.

“They have got us stuck in a hard place.”

Mr Crawford said he was “certainly not opposed” to bringing back a state government insurance organisation, which was sold off in 1996, and would discuss the feasibility of it with departmental staff.

According to the ICA, North Queensland residents are six times more likely to lodge a claim than other parts of the country, while insurers pocket $1 for every $1.40 in claims.

A 2016 report listed mitigating premiums, for example cyclone-proofing households, as the key recommendation to lowering costs to consumers.

ICA will visit the Far North in coming weeks to hold forums on cyclone mitigation.

Mr Fuller said mitigation would protect communities and properties for generations.

“The cost of mitigation is repaid tenfold or more over the life of the infrastructure,” he said.

Treasurer and Mulgrave MP Curtis Pitt was contacted for comment.