Insurance Gaps in Australia: Surging Premiums Amid Extreme Weather Events

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SYDNEY – Australians are increasingly facing challenges securing insurance due to surging premiums, with extreme weather events being a significant factor, according to recent research by consumer advocacy group CHOICE.

The research, conducted in collaboration with the Climate Council, Financial Counselling Australia, the Financial Rights Legal Centre, and the Tenants’ Union of NSW, reveals that many Australians cannot obtain insurance during crucial times of crisis. This poses a substantial risk, especially when the country has witnessed extreme weather events.

The implications of these findings are profound. Rising insurance premiums mean that many homes remain unprotected against unforeseen calamities. Western Australia (WA) residents have been particularly vocal about their experiences. 

Several small business owners in WA informed ABC Radio Perth about the exponential increases in their premiums. In a striking instance, a resident near Margaret River in the South West reported a 40% spike in his insurance premium since a 2011 bushfire affected his area.

The issue is not confined to homeowners alone. Concerns have arisen over the construction and property development in areas prone to disasters. 

“Property developers need to bear some responsibility for where they locate housing developments,” one resident remarked, emphasising the inherent risks associated with developing in danger-prone regions.

The question of why premiums are rising has garnered varied opinions. Some listeners of ABC Radio Perth suggested that rising insurance premiums reflect the reinsurance costs borne by insurance companies. However, the discourse is not entirely in favour of the insurance sector. 

Some Australians believe that certain insurance companies might be exploiting the situation. Opinions about insurance subsidies are also polarised. A section believes that grants, often availed by the private sector, inflate profits.

“Absolutely no to insurance subsidies. The private sector has always used subsidies to inflate their profits,” a listener said.

In this complex landscape, the importance of comprehensive insurance coverage is evident more than ever. As Australia grapples with the challenges of climate change and its associated weather patterns, ensuring that citizens can adequately protect their assets becomes paramount.


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