Hazards Insurance Partnership meets on risks, affordability

The Hazards Insurance Partnership, involving the Federal Government and the industry, has held its first meeting as part of aims to improve resilience for extreme weather risks and to put downward pressure on premiums.

The October Federal Budget provided $22.6 million over four years for work focused on identifying the most pressing insurance issues in high-risk areas, targeting the best solutions, and supporting better consumer outcomes via more affordable cover and a better understanding of insurance.

The meeting in Brisbane was attended by Emergency Management Minister Murray Watt, Assistant Treasurer and Financial Services Minister Stephen Jones and Co-ordinator General of the National Emergency Management Agency (NEMA) Brendan Moon.

Representatives attended from the Insurance Council of Australia and five of the largest insurers, Treasury, the Australian Bureau of Statistics and the Australian Climate Service.

ICA CEO Andrew Hall says the meeting was a first step in providing a pathway on how the partnership will work, key issues to be addressed and the opportunities.

“Insurers have a critical role to play in identifying the risks from worsening extreme weather, and the data we will be able to provide to government will help drive the investment needed to reduce that risk,” he said.

Mr Watt says the Government has established NEMA and the Disaster Ready Fund and has announced an independent review into Australia’s disaster funding system.

“Partnering with insurers to share information on disaster risk will allow us to better target mitigation,” he said. “This is the next step in our plan to build Australia’s resilience to natural disasters.”

Mr Watt and Mr Jones say the partnership will establish a workplan to ensure that the government and the insurance industry are collectively working to ensure Australians have access to affordable and appropriate insurance.

“It is vital that we make coverage for natural hazards easier to understand when taking out an insurance policy,” Mr Jones also said.

Applications have now opened for the first tranche of allocations from the Disaster Ready Fund, which will provide $1 billion in federal mitigation funding over five years starting from July. The program delivers on a pre-election commitment and realises insurers’ longstanding campaign for mitigation spending to be increased to $200 million a year.

States and territories are eligible to apply and are expected to work with local governments and communities to identify suitable proposals. Applicants must also contribute at least 50% toward a project’s cost.