The Insurance Council of Australia has called on the next federal government to protect properties at the highest risk of flooding as Logan residents face insurance premium hikes of several hundred percent.
A new report by the insurance industry’s representative body found the Logan and Albert river catchments contained among the highest and most extreme flood-exposed properties in the country.
This means flooding in the city is a potential risk to life, homes and businesses, as well as insurance affordability.
The report suggested the Australian government – post the 2025 election – invest $30.15 billion over the next decade to protect properties in the most at-risk areas.
The fund, split between the federal and state governments, would build new flood defence and mitigation infrastructure such as levees and dams ($15.15 billion), fund property buy-backs ($10 billion), and strengthen at-risk properties ($5 billion).
According to the report, an investment of this magnitude would reduce the impact of the floods and moderate insurance premiums for residents.
It is also recommended the government provide better data and flood mapping, which has been the subject of controversy in Logan for a number of years.
Many residents claim the new flood mapping wrongfully identified their properties as being a high flood risk, despite never experiencing a drop of flood water.
For many, this has led to huge insurance hikes, with some as high as 400%.
One Logan councillor, Scott Bannan, in the past said the premium for one particular resident rose from $3500 to $35,000 since the mapping data was released.
He said these increases were “putrid”.
Early last year, Logan City Council called on the state government at the time to hold an inquiry into insurance price-gouging
Last week, the Insurance Council of Australia CEO Andrew Hall said premiums had risen over the past few years due to a “perfect storm” of high inflation, taxes and regulations, extreme weather events and ever-increasing risk factors.
“In a cost-of-living crisis, it is important that all our efforts go into measures which will bring downward pressure on premiums, and this can only be achieved through a strong partnership between insurers and governments,” he said.
“That’s why advancing Australia’s resilience includes a big idea to combat a big problem over the long-term – the creation of a $30.15 billion, ten-year Flood Defence Fund to protect Australians from our costliest natural disaster.
“Consumers, however, cannot wait for mitigation and risk reduction programs to offer the critical protection and price relief needed.”
Mr Hall said immediate action in the form of tax and regulatory reform was needed.
“Insurers stand ready to play their part in this important reform, but significant new government investment is the only way to reduce extreme weather risk and must underpin our future collaborative endeavours..
“We know there is no silver bullet.
“However, if we don’t do anything, insurance customers, governments and taxpayers will continue to pick up the much higher costs of rebuilding every time there is a natural disaster and insurance risks becoming unavailable and affordable for those Australians who need protection the most.”
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