The Insurance Council of Australia (ICA) has expressed support for the recent report by the House of Representatives Standing Committee on Economics, which reviewed how the insurance sector handled claims from the 2022 floods.
The inquiry led to 86 recommendations, all aimed at improving the industry’s response to natural disasters and enhancing consumer protections.
The report’s key recommendations include removing state taxes on insurance, increasing government funding for resilience and disaster mitigation, and implementing stricter planning measures to restrict construction on flood-prone land.
The ICA has welcomed these changes, noting they would help lower premiums and provide better protection for communities at risk of future extreme weather events.
Although more than 300,000 claims were lodged after the floods, the report noted some customers experienced service issues. Insurers have apologised to those affected and committed to improving service through investments in staffing, training, and updated technology.
ICA CEO Andrew Hall highlighted the magnitude of the 2022 floods, which resulted in over $7.7 billion in insured losses, including $6.3 billion from a single event. He acknowledged that the industry’s response was stretched by the unprecedented number of claims, but said efforts are already underway to address the shortcomings.
“Insurers acknowledge there were failures of systems, processes, and resourcing in response to the extreme weather events that occurred during 2022, and the industry is already taking action to address these challenges,” he said.
He added that the ICA will collaborate with governments and other stakeholders to implement the recommendations while keeping premiums affordable.
Insurance Australia Group (IAG), which owns brands like NRMA Insurance and CGU, also responded positively to the committee’s findings.
IAG managing director and CEO Nick Hawkins described the inquiry as a valuable opportunity to learn from the challenges of 2022 and strengthen the company’s ability to handle future severe weather events.
“The catastrophic 2022 floods were devastating for many people and communities, and the extraordinary number of claims we received tested our capacity to respond at this unprecedented scale,” he said.
He said that many customers received timely assistance, but others did not experience the level of service IAG strives to deliver. In response, the insurer has expanded its claims team and introduced new processes to shorten claim resolution times and better assist vulnerable customers.
The Australian and New Zealand Institute of Insurance and Finance (ANZIIF) also backed the committee’s recommendations.
ANZIIF CEO Katrina Shanks praised the report for its focus on improving outcomes for policyholders and noted that ANZIIF is committed to supporting the industry through education and training initiatives.
“We are committed to supporting the industry through quality education and professional development which continually strengthens the insurance sector,” she said.
In response to the report, ANZIIF is hosting a webinar with committee chair Dr Daniel Mulino MP to offer further insights into the inquiry’s findings and recommendations. The webinar aims to help insurance professionals understand the report’s implications and its potential impact on future policy and practices.
