Australia’s peak body representing the insurance industry defends reports of “prohibitively expensive” insurance premiums of up to $30,000 a year in flood-hit parts of northern New South Wales.
The Insurance Council of Australia (ICA) says the Federal Government needs to allocate $200 million in the next budget for flood mitigation measures for premiums in the region to come down, the ABC reports.
Lismore residents in northern New South Wales claim flood insurance remains prohibitively expensive, despite a town levee designed to lower the risk of catastrophic damage
“Insurers are required to risk-rate customers, and where the risks of flood are high, those risks are reflected in the premiums,” ICA spokesman Campbell Fuller told the ABC.
“The only thing that can significantly and sustainably reduce the risk of flood is permanent mitigation.
“And the flow-on effect from that is that premiums fall – we’ve seen that right around Australia where permanent mitigation is put in place.”
The ICA spokesman says Lismore’s levee did not reduce the risk of damage for larger floods, and therefore could not curtail the high insurance premiums.
“The flood levee in Lismore is designed for a very small flood, it’s not designed for the catastrophic flood that we have seen in Lismore and that Lismore has suffered in the past.”
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