SUBMISSION: Market Failure in Insurance in Northern Australia
Posted: 1 February 2025
Insurance Market Failure in Northern Australia – Federal Budget Submission
On 31st January 2025, we uploaded the Townsville Chamber of Commerce’s federal budget submission, Insurance: The Market Failure of an Essential Service in Northern Australia. This submission, backed by 20 Chambers of Commerce across Northern Australia, represents thousands of businesses struggling with unaffordable or unavailable insurance.
How ironic that last year’s submission deadline coincided with TC Kirrily crossing Townsville, and here we are typing away with the rain lashing around us, about the same unresolved crisis.
Insurance is not a luxury—it’s essential for businesses to:
- Secure finance and investment
- Meet legal and contractual obligations
- Rent commercial space
- Trade locally and internationally
Yet, insurance is becoming more unaffordable and unattainable in Northern Australia, leaving businesses exposed and economically vulnerable. Without attainable and affordable insurance, investment effectiveness is severely limited. The LNP’s NAIF commitment is commendable, but without attainable and affordable insurance, investment effectiveness is severely limited.
A Summary of Our Key Recommendations:
- Amend the Reinsurance Pool to deliver real premium reductions for business
- Ensure insurers cover all of Australia, not just low-risk areas
- Establish a National Insurer to guarantee coverage where the private market fails. The government are the insurer of last resort already
- Abolish Stamp Duty & GST on insurance—it’s an essential service!
- Enforce transparency so savings actually reach consumers
- Invest in mitigation & resilience- only when it increases affordability and accessability of premiums
This is not just a Townsville issue—it’s a Northern Australian crisis. We need urgent policy intervention before more businesses are forced to close.
We encourage policymakers to review our submission and take action.
You can review our full submission HERE
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