Home / Daily / Strata group seeks govt action on Qld problems
9 October 2020
The Strata Community Association (SCA) in Queensland has called for governments to step in to ensure affordable insurance cover is available for multi-unit buildings as market conditions in the state’s north continue to deteriorate.
SCA Queensland President James Nickless says options could include something similar to a public-private natural disaster compensation scheme in France, or arrangements that operate in Australia for building defects.
“We are not saying we have the final answer, but we think this is an area that governments both state and federal need to look into,” he told insuranceNEWS.com.au today.
“It really comes down to, do we care about the residents of Far North Queensland? Do we want to protect them, do we want to allow them to have reasonable access to insurance and, if we do, then this is a solution that needs to be considered.”
The SCA is pushing for action ahead of the Queensland state election at the end of this month, and as the Australian Competition and Consumer Commission prepares to deliver its final report by November 30 after a three-year inquiry into Northern Australia insurance.
Mr Nickless says there is scope for the Queensland Government to act independently or to use its influence to pressure the Federal Government to establish some form of national compensation fund.
Assistant Treasurer Michael Sukkar said last year Treasury would explore the possibility of a government-funded cyclone reinsurance pool, but the Government also appears to be waiting for the release of the ACCC’s final report.
The ACCC’s latest interim report did not recommend reinsurance pools or mutuals, instead favouring improved disclosures, action on broker commissions, mitigation and abolishing stamp duties.
Mr Nickless says commercial conditions in the market are not encouraging sufficient competition and measures proposed by the ACCC are going to make little difference for strata developments.
“That to us leaves these buildings in a position where we think the government needs to do something about it,” he said.
Premiums are still rising by 100-300% for strata developments in the north, some are finding it difficult to obtain cover and anecdotally issues are spreading further south, he says.
The SCA’s membership includes strata managers, body corporate committee members and professionals involved in the sector. In Queensland, members represent 312,000 of the 500,000 lots in the state, its website says.