Australia: P&C insurers rue lack of mitigation investment by govt
Source: Asia Insurance Review | Jun 2017
The Insurance Council of Australia (ICA) has called the federal Budget announced on 9 May as a “missed opportunity to invest in urgent nation-building mitigation and resilience measures”.
In a response to the Budget, ICA CEO Rob Whelan noted that the government is allocating A$7.9 million (US$5.8 million) over four years to the Australian Competition and Consumer Commission (ACCC) to monitor insurance in weather-prone northern Australia. He said that the move “does not address the real problem – the impact of extreme weather on vulnerable communities”.
He added: “The insurance industry will fully cooperate with the ACCC; however, the federal government has already spent tens of millions of dollars on numerous reports into insurance in northern Australia, which have concluded insurers are operating in a competitive market and are appropriately pricing risk.”
Commenting on the urgent need for a significant increase in spending on nation-building mitigation infrastructure and resilience measures, he said that the allocation of A$26.1 million in disaster resilience programmes is well below the minimum A$200 million a year recommended by the Productivity Commission and overlooks the endorsement of mitigation by its own Northern Australia Insurance Premiums Taskforce. A