The Australian insurance industry is pulling out all the stops to ensure that the industry is ready to respond swiftly for customers as the impact of Middle East conflict continues to evolve across all lines of insurance business.
The Insurance Council of Australia (ICA) has tasked its most senior industry committee for this purpose. Preliminary industry data shows that rising fuel costs are disrupting existing supply chains, increasing the cost of materials, and delaying labour to complete repairs to homes and vehicles.
An ICA media release said, “Insurers have reported price increases of up to 36% for building materials, up to 30% for trades and on-site specialists, and up to 50% for freight.”
The statement added, “Following a recent meeting of the Board, the ICA’s Board Strategy Committee will work proactively on these issues:
• Work with member companies to support consumers seeking hardship assistance in line with the General Insurance Code of Practice.
• Lead cross-sector engagement with government and industry stakeholders to anticipate supply chain disruptions and develop mitigation strategies.
• Coordinate proactive communications to small businesses, encouraging them to talk to their insurer and/or broker for information around policy coverage or adjustments to premiums.
While claims directly linked to Middle East supply chain disruptions have not yet materialised, the ICA has systems in place to track, detect and respond to any shifts as they emerge.
ICA said it has noted the Government’s release of four levels of action: ‘plan and prepare’; ‘keeping Australia moving’; ‘taking targeted action’; and ‘protecting critical service’ and is committed to working with the Australian Government on practical relief measures during this uncertain time.
ICA CEO Andrew Hall said, “The insurance sector, as always, through times of crisis, stands ready to work together with Government to support Australians as supply chains cause further disruption and add cost pressures to customers and the operations of the industry.
“In the same way the ICA works when a natural catastrophe occurs, the board has tasked the industry’s most senior executives to monitor impacts and, as appropriate, coordinate the industry’s response.”
Mr Hall said, “We welcome National Cabinet’s announcement around the staging of the impacts of the war on Australia, as we continue to work with state and federal governments to support Australians.”