More homeowners ditch cover over high premiums
THE number of uninsured homes in Northern Australia is "significant and growing", with residents stating they either can't afford or justify the cost.
The Australian Competition and Consumer Association Northern Australia insurance inquiry second interim report, released on Friday, found an estimated 17 per cent of households (or 62,125 homes) in north Queensland were uninsured.
It is estimated the average home building insurance premiums in north Queensland were about $1870.
According to research commissioned by the ACCC, 95 per cent of homeowners who chose not to insure said they found the cost unaffordable or unjustifiable.
The ACCC, at the behest of government, also delved into the impacts of the February flooding on small business insurance in Townsville and found nearly 50 per cent of businesses who had insurance but not flood insurance didn't realise they weren't covered until it was too late.
No further recommendations were made in the latest iteration of the report, with the ACCC noting state governments had "not indicated any support" for either removing or rebasing stamp duties.
Of the recommendations that require Federal Government action, the ACCC noted the government had introduced a bill into parliament to ban unfair contract terms in standard insurance contracts.
The Federal Government had also provided additional funding for public mitigation works.
Cairns-based Labor senator Nita Green slammed the Federal Government for failing to deliver on "their one promise" to address unfair contract terms in insurance contracts as the legislation failed to pass this year.
Townsville-based economist Colin Dwyer slammed the timing of report's release, on a Friday before the long Christmas break, as "disingenuous" and said the Federal Government was complicit.
"It's like the ACCC doesn't have any power to make positive change and the Federal Government aren't really interested in finding a solution, neither is the State Government," he said.
"There's all this rhetoric in the Federal Government that they want to develop the north, but they're not actually putting their money where their mouth is, such as providing subsidies for people in the north."
Federal Assistant Treasurer Michael Sukkar said the government noted the report and reaffirmed the commitment to take action now.
"We are acting now and engaging with the insurance industry to develop options that will have a real impact on consumers in Northern Australia," he said.
The Insurance Council of Australia highlighted the report's finding that government reinsurance pools and government-run insurers were not well suited to lowering insurance premiums.
It comes after the Federal Government last month refloated the possibility of a government reinsurance pool, an idea historically opposed by large insurers.