The prime minister has accused insurance companies of ripping off Australians, saying ex-Tropical Cyclone Alfred is a chance for them to repair their reputations.
However neither major party is offering a solution to perceived anti-competitive behaviour, with a pitch by Opposition Leader Peter Dutton last month quickly hosed down by colleagues.
Prime Minister Anthony Albanese was asked whether he agreed with financial reporter David Koch’s view that insurance companies “have plenty of money, they are ripping us off” and had doubled premiums in recent years — to which Mr Albanese flatly said he agreed.
“I say that Kochie is right” Mr Albanese told Channel 7.
“We will certainly hold the insurance companies to account. This is a time where they need to do a bit of repair of their relationships with the Australian public by doing the right thing and making payments immediately.”
Mr Albanese said he hoped insurers would do the right thing, but would consider further action if they did not.
A Labor-led inquiry into major flooding in Queensland and northern NSW in 2022 concluded “too many” insurance cases were badly mishandled by insurers, inconsistently offered support and more than two years on had left many people still unable to go home.
Among 84 recommendations, that inquiry called for mandatory decisions within 12 months of a claim with claims accepted in full past that deadline, an enforceable code of practice and standardising of insurance contracts.
The federal government is yet to respond to that report.
Suburbs across Queensland and northern NSW have been inundated with rain from ex-Tropical Cyclone Alfred. (ABC News: Tobi Loftus)
Insurers call for help, blaming increasing frequency of disasters
Household insurance costs rose 11 per cent over the year to December 2024, which was actually a slight moderation in what has been a soaring expense since inflation began running hot.
Insurers have blamed their rising costs, in part, on the increasing frequency and severity of natural disasters and have urged the government to step in at flood zones and other high risk areas or else those homes could become uninsurable.’
Last month the insurance industry called on the federal government to establish a $30 billion ‘flood defence fund’ that could be used to reduce risk for homes in flood prone areas through building levees or other mitigating measures.
However Labor and the Coalition are yet to announce any policies to address either rising insurance costs for Australians or the increasing risks for insurers to insure homes exposed to natural disasters.
Last week Mr Dutton suggested the Coalition could extend its plan to create break up powers for supermarkets and retailers to the insurance industry as well, threatening to intervene in the insurance market to stop Australians being “ripped off”.
But his colleagues have since shut down that idea.
Shadow Treasurer Angus Taylor last week said the Coalition had been “clear” it would not legislate divestiture powers for the insurance sector, a position restated by Liberal deputy Sussan Ley this morning.
