FNQ insurance solution: Another report
The federal government’s solution to Far North Queensland’s insurance fiasco is to fund a $2 million taskforce for six months to produce an interim report after three months and a comprehensive report and the end of the term.
Member for Leichhardt Warren Entsch said the taskforce will consider two options to reduce the excessive cost of insurance premiums: a government-run reinsurance pool; and community-owned Northern Australia mutual insurer providing cyclone-specific cover.
There has been no mention of availability of insurance to high-risk strata properties.
“Getting where we are today has been about going down every avenue to prove that we don’t have access to affordable insurance here in Far North Queensland – which is, in effect, market failure. Whatever the outcome is, it will provide people with a premium that is close to parity with other areas,” Mr Entsch said.
Mr Entsch said a mutual insurer could provide a catastrophe/cyclone/flood event cover of up to $350,000 plus $75,000 in contents. Mr Entsch said he was introduced to the idea of a mutual insurer by the Cairns Chamber of Commerce that launched its own scheme last week.
A statement from PM Tony Abbott’s office said the taskforce would also assess the merits of other policy options that currently exist or are put forward by stakeholders during consultation. “The taskforce will be headed by a senior official supported by staff from the private sector and relevant government departments, and draw on a reference panel of industry experts, including in the areas of insurance and reinsurance,” the statement said.
