Unequal state funding models for emergency services should be scrapped because they add to the number of Australians who are uninsured or underinsured, insurers and brokers have urged in submissions to the bushfires royal commission.

More than 1400 public submissions, making up over 12,000 pages, have been lodged with the royal commission examining the handling of last summer’s devasting bushfires. Organisations submitted around 300 and individuals the rest .

The first phase of online hearings will take place next month and the six-month inquiry is scheduled to deliver its final report by August 31.

A submission published today by the National Insurance Brokers Association (NIBA) says some state and federal taxes can account for up to 70% of insurance premiums.

It says the levies are “inequitable and needlessly opaque.”

“Inefficient and poorly designed tax systems should not be stacked on top of each other for the sole purpose of collecting revenue at the expense of the public good,” NIBA says.

Calling for “a fairer, more equitable” model, it says efficient emergency services funding is vital to the response of state and territory governments to natural disasters. It calls for a “more holistic” approach to disaster mitigation and the abolition of insurance-based taxes such as NSW’s Emergency Services Levy and Tasmania’s Fire Service Levy.

These insurance-based funding models should be replaced with a broad-based property levy, similar to the one introduced in Victoria following the 2009 Black Saturday bushfires, NIBA says.

Suncorp has also recommended taxes and charges should be removed from insurance policies, or the method of calculation should be revised so that customers in higher-risk areas are not paying “more in taxes as well as higher base premiums”.

Suncorp’s 28-page submission calls for the Federal Government to address a “chronic shortfall” in funding for disaster mitigation with a $200 million a year boost, to be matched by the states and territories.

“This should be considered as the minimum investment required by government,” Suncorp says. “Successive governments have wrongly ignored the imbalance of spending 97% of our disaster funding on recovery, and only 3% on prevention and mitigation.”

GST should not be charged on insurance premiums, the insurer says, proposing instead that customers should receive a rebate of the GST incurred, either as a cash payment or tax offset, with encouragement to spend this amount on resilience measures to reduce risk in the long term.

Suncorp suggests many measures to improve the resilience of buildings, such as granting the Insurance Council of Australia (ICA) permanent membership of the Australian Building Codes Board, special floor heights in flood-prone areas, a review of the National Construction Code and increased regulatory oversight.

A national resilience-building program would help to place downwards pressure on insurance premiums, Suncorp says.

“Such a program should involve government, the insurance industry and communities, with an initial focus on high-risk areas and assets, and implementing existing proposals.

“The solution requires action from all levels of government, individual homeowners, the construction industry and financial services providers, as well as other industry and community sectors,” Suncorp says.

Its recommendations also suggest changes to advice rules so insurers can target information to customers regarding their risk and appropriate levels of insurance.

It calls for tax relief to assist with the purchase of insurance, the addition of bushfire attack-level ratings to rates notices and agreed arrangements for the removal of debris following natural disasters.

Suncorp also wants updated flood mapping across Australia and a national assessment of resilience to bushfire, cyclone, flood and other major national perils in collaboration with CSIRO, Standards Australia, insurers and other stakeholders.

IAG is still in the process of finalising its submission, after being given extra time to submit it, a spokesman told insuranceNEWS.com.au, while ICA is waiting for the royal commission to publish before revealing the contents of its document.

The submissions will be published on a rolling basis on the royal commission’s website.