For example, Michele Vanderlanh Smith discovered her annual home and contents insurance premium had jumped by 600%, from $728.16 to $5,345.88. When she sought clarification, she was informed that to challenge the increase, she would need to obtain a hydrologist's report at her own expense.
Julia Davis from the Financial Rights Legal Centre highlighted that households are facing steep hikes with little or no explanation. She noted that the pricing algorithms insurers use are commercial in confidence, making it difficult for consumers to know if they're being charged a fair price.
The Australian Competition and Consumer Commission (ACCC) has reported that insurance premiums are rising across the country. In the Northern Territory, for instance, the median home and contents premium increased by 11% during 2023. Despite the establishment of a cyclone reinsurance pool aimed at reducing costs, premiums continue to rise, particularly in northern Australia.
Consumer advocates are calling for national independent insurance price monitoring to ensure transparency and fairness in the industry. They argue that without clear explanations for premium increases, consumers are left in the dark and may be paying more than necessary.
For tradespeople and small business owners, these developments underscore the importance of regularly reviewing insurance policies and seeking competitive quotes. Understanding the factors influencing premium costs and advocating for greater transparency can help ensure fair pricing and adequate coverage.
