A Lawnton resident who was affected negatively by two devastating floods is now facing a new challenge – skyrocketing home insurance costs.
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The local woman, who suffered from both the 2011 and 2022 floods, revealed that her premium has jumped from $5,900 to $39,186, representing an over 500 percent increase from the previous year.
She expressed dismay that the rate is now drastically higher than her annual income, questioning how she could possibly afford a $30,000 rise in her home insurance premium.
An insurance expert explained that unfortunately, stories like this are becoming more common as some insurers opt to exit certain high-risk markets altogether.
A representative for the Insurance Council of Australia said that insurance affordability and availability are the top priorities for the industry right now. He urged the government to allocate more funding towards resilience initiatives that would help reinforce homes and make them better able to withstand natural disasters.
The massive premium increases are leaving many residents uninsured and exposed, according to the spokesperson. He explained that insurance rates are based on risk, and the growing frequency and severity of extreme weather is making policies unaffordable for a lot of people, particularly those living in flood-prone areas.
On top of the impact of natural disasters, rising inflation and the escalating cost of reinsurance purchased by insurance companies themselves are also contributing factors behind the surging premiums, the spokesman noted.
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As extreme weather events become more frequent and severe, stories like this Lawnton resident’s plight may grow more commonplace. With insurance premiums skyrocketing out of reach for many homeowners, especially in high-risk areas, a collaborative approach between insurers, government, and communities will be needed to find solutions.
Published 11-January-2024
