Many areas in Australia are suffering from underinsurance – including north Queensland, which has up to a quarter of underinsured houses due to storm-inspired premiums that are three times the price of the rest of the country.
Floods, cyclones, and other emergency events have flattened and damaged homes in north Queensland – resulting in rising insurance premiums. As a result, Federal MP Bob Katter is calling to expand The Commonwealth's terrorism reinsurance scheme to encompass state-of-emergency events such as those in the region.
The scheme provides primary insurers with reinsurance for commercial property and associated business interruption losses arising from a declared terrorist incident.
“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,” federal MP Bob 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.”
Mr Katter said Prime Minister Scott Morrison responded positively during their meeting.
“A quarter of the houses in north Queensland are now not insured, but the chances of any houses being blown away are low as all the houses that could be blown away have been blown away,” Katter said.
Allianz Insurance has shown its support for a reinsurance pool, describing it as an “effective and efficient way of reducing the cost of insurance” for cyclone-risk property owners.
