The Insurance Council of Australia (ICA) has labelled the Queensland Government’s 2021/22 Budget a “missed opportunity” to invest in mitigation works and cut insurance taxes.

In a statement released today, ICA says the Budget announced just $10 million for household resilience and mitigation measures to protect Queenslanders from extreme weather events.

With just $3 million to be spent on new household resilience funding in 2021/22, the Budget has failed to confront the enormity of the challenge to make Queensland homes and businesses more resilient to natural disasters, ICA says.

The insurance industry’s peak body also pointed out the Palaszczuk Government is not renewing the Household Resilience Program – a $41.5 million funding scheme to help eligible homeowners in coastal areas improve the resilience of their homes against cyclones.

ICA says the move will leave many Queensland homeowners without support for much-needed home building mitigation.

In addition to the disappointing investment in resilience and mitigation, the ongoing failure to address stamp duty on insurance means underinsurance will continue to be an issue in the state with the greatest exposure to the impacts of natural disasters, ICA says.

“Insurers have been calling for some time for greater investment in resilience and mitigation measures, so it’s disappointing the Queensland State Budget fails to meet this challenge,” CEO Andrew Hall said.

“The Federal Government’s recent allocation of $600 million over five years for new disaster preparation and mitigation programs and $40 million to make strata buildings in northern Australia more resilient to extreme weather potentially unlocks significant partnership investments with the states.

“Queensland should be looking to maximise these opportunities.”

He says on the revenue side, stamp duty on insurance remains a retrograde measure that numerous inquiries and reviews have found leads to household underinsurance or non-insurance.

Mr Hall repeated the ICA’s calls urging all state and territory governments to advance tax reform and remove stamp duty on insurance products to increase insurance affordability for all Australians.

In the Budget released yesterday, the Palaszczuk Government outlined what it says are further funding and actions to support risk mitigation through key infrastructure schemes such as the $418.3 million Building our Regions program.

It says key measures in the 2021/22 Budget that will also help increase disaster resilience and support insurance affordability include:

• $14.4 million in funding to support mitigation projects in 2021/22 through the $65 million Queensland Resilience and Risk Reduction Fund, jointly funded by the Australian Government

• $10 million additional funding to establish the North Queensland Natural Disasters Mitigation Program to administer grants to local government for disaster mitigation initiatives that assist in reducing the cost of insurance in their communities.

“Over the past decade, north Queensland has borne the brunt of multiple major cyclones and floods, contributing to large increases in insurance premiums and reduced availability of insurance coverage,” the Budget paper says.

“The Queensland Government’s ongoing investment in mitigation works, complemented by the Australian Government’s recent commitments, will help to put downward pressure on insurance premiums for Queensland families and businesses in high-risk and cyclone-prone areas."

The Budget also announced $10.8 million over four years has been allocated to implement priority actions in response to the Royal Commission into National Natural Disaster Arrangements in Queensland and $13.8 million over the same period to support existing public cyclone shelters.

Click here for the Budget paper.