I support the investigation into high insurance premiums

I COMMEND the Federal Government for its investigation into the high cost of insurance in Central Queensland.

Government wants to protect victims from insurance hikes

For too long, people living here have been hit with the double whammy of a natural disaster and the aftershock of a massive insurance hike.

The beleaguered resident might then be forced to shop elsewhere - and sometimes cheaper may not necessarily be better.

In the Rockhampton region for instance, we have just had our second devastating cyclone in 66 years.

The damage bill was estimated at $700million last week.

Let's say 50,000 properties were insured at say an average of $1200 per property for a total annual premium of $60million.

How have you found your insurance premium prices of late?

This poll ended on 03 April 2015.

Current Results

Reasonable

6%

Average

3%

High

35%

Extremely high

56%

This is not a scientific poll. The results reflect only the opinions of those who chose to participate.

This won't be perfect future cash flow calculations, but let's say we didn't get another bad cyclone for another 66 years.

That means insurance companies would have taken in $4billion for a payout of $120million - not withstanding there may be 15 flood claims along the way to offset the Rockhampton profits.

I'll say again, these are wild calculations, but based on this Rockhampton is a good forward bet for an insurance company based on historical records.

That's why a government-backed re-insurance pool for catastrophes like cyclones and other natural disasters is sound policy to ensure that insurance companies don't have a reason to inflate premiums.

Capricornia MP Michelle Landry is a strong supporter of the high-level taskforce which will study options that would compel insurance companies to offer more affordable premiums for people living above the Tropic of Capricorn.

I wish her every success in supporting this initiative as it would make a real difference to Central Queenslanders.



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