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Queensland Budget Fails North Queensland Residents on Insurance Cost of Living, Favours SEQ

Queensland Treasurer Cameron Dick delivered the state budget yesterday, offering cost-of-living savings for Queenslanders. However, it glaringly failed to address the insurance cost crisis in North Queensland, opting instead for cheaper public transport fares to benefit Southeast Queensland.

Queensland, Australia's most uninsurable and unaffordable state, is predicted to have 6.5% of homes effectively uninsurable by 2030, according to a Climate Council report, “Uninsurable Nation: Australia’s Most Climate-Vulnerable Places" (click here). In comparison, New South Wales, the next most uninsurable state, is expected to have 3.5% of homes effectively uninsurable by 2030. This disparity demands immediate action from the Queensland government to ensure economic prosperity for all residents.

“North Queensland residents and those grappling with extreme affordability issues should be outraged by the Queensland government's inaction and lack of attention to this critical issue. The government's failure to address insurance affordability has cemented Queensland's status as the most uninsurable and unaffordable state in Australia.” ACIL Chair Tyrone Shandiman said.

Residents in North Queensland pay at least twice the premium of those in other parts of Australia, and consequently, twice the stamp duty, as revealed in the ACCC Northern Australia Insurance Inquiry of 2020. Despite the implementation of the Cyclone Reinsurance Pool, it has failed to deliver the necessary savings to North Queensland residents (more info, click here).

As a result, North Queensland residents pay significantly higher insurance stamp duty than other parts of Queensland. With the budget’s focus on reducing public transport fares, it is evident that additional revenues from insurance duties from northern residents are subsidising transport services predominantly utilised in high-density Southeast cities. While the increase in the announced threshold for stamp duty relief for first home buyers is a welcome step, what is the point if those buyers cannot afford to insure their new homes?

Margaret Shaw, a Queensland resident who began advocating for fairer, more affordable insurance for North Queensland in 2011, said, “The sudden rise of 324% in insurance premium for our property led to our premium becoming an astonishing three to five times greater than those for similar properties in other parts of Australia. Regrettably, this also translated to a three to five time increase in stamp duty expenses. It's disheartening to witness the unfairness of consumers in Northern Australia, who are already grappling with cost-of-living pressures related to insurance costs, being compelled to contribute so much more stamp duty than their counterparts in other regions of the country for properties of similar value.”

ACIL has met with representatives from both Labor and LNP earlier this year, advocating for stamp duty reform. ACIL calls for the abolition of stamp duty as the first preference or increased spending on mitigation and resilience to reduce insurance premiums. We urge the LNP to address this critical issue in their budget reply.  More information on ACIL’s concerns and recommendations can be found in the attached flyer.

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