The government’s reinsurance pool bill could see premiums slashed, but details still scant

Business and community leaders have welcomed proposed legislation aimed at slashing the cost of home insurance for thousands of households in cyclone-prone parts of Australia, but say they are still in the dark about the details.

The government’s long-awaited reinsurance pool is scheduled to come into effect from July 1.

It promises to correct a market failure that has seen the price of some premiums in northern Australia soar by up to 20 times the cost of insuring a property in Sydney or Melbourne.

The bill, expected to pass parliament this fortnight, is backed by the Northern Australian Insurance Lobby (NAIL), whose chair Margaret Shaw has led a decade-long campaign for fit-for-purpose insurance for northern Australians.

“I have seen people go bankrupt, I have seen people have bankruptcy because they can not cope with their insurance premiums,” Ms Shaw said.

Margaret Shaw has long been pushing for change on the issue.(ABC North Qld: Jade Toomey)

NAIL still has concerns about the bill excluding commercial buildings that are insured for more than $ 5 million.

“But I have a commitment from the federal government that in the 12-month review they will review strata accommodation models, they will review small marine business property and they will review residential home care,” Ms Shaw said.

A man in a dark suit, flanked by a woman and another man, speaks to the media.
Assistant Treasurer Michael Sukkar admitted that insurance companies were yet to learn the details of the legislation.(ABC News)

‘Crying out for this’

Assistant Treasurer Michael Sukkar said the reinsurance pool would deliver $ 2.9 billion worth of savings for homeowners over the next decade.


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