The inquiry will look into the floods in Lismore last year.Credit:Getty
The floods that hit south-east Queensland and northern NSW around the town of Lismore were estimated to have cost insurers almost $6 billion in losses,making it the single most expensive insurance event in Australian history.
Insurance premiums have soared since the floods. In the 12 months to the end of June,insurance prices as measured by the Australian Bureau of Statistics climbed by 14.2 per cent,the highest annual increase since the introduction of the GST.
Insurance complaints have surged by as much as 76 per cent over the past year,with many people upset at their coverage or treatment by insurers.
Jones said parliament’s economics committee would have until the end of September next year to report back on the issues raised by last year’s floods,with a focus on issues such as affordability,the resolution of insurance claims and whether planning controls were affecting the ability to insure parts of the country.
While focused on last year’s floods,the terms of reference will give the inquiry scope to canvass issues common to all natural disasters such as claims handling and dispute resolution.
“We’re not looking for short-term Band-Aid solutions here. We want to develop long-term mitigation strategies and tackle the underlying issues that make it harder for consumers and drive up insurance premiums,” Jones said.
As well as examining whether insurers are prepared for future flood events,the inquiry will look at obstacles to resolving claims,such as temporary accommodation and access by policyholders to hydrology reports.