Suncorp has hammered home the case against Government intervention in the northern Queensland insurance market and says overseas examples aren’t a template for local solutions.

The Australian Competition and Consumer Commission’s Northern Australia Insurance Inquiry called for submissions by today on measures to improve insurance affordability and availability in the region, including a possible government-backed pool or mutual.

Overseas examples have included the US flood insurance program and the UK’s Flood Re, launched in 2016.

Suncorp says governments have stepped in overseas as a last resort after market failure, which was highlighted in the UK when only 9% of homeowners who had made previous flood claims could get a quote from two or more insurers, and premium increases of several hundred percent were possible.

“Suncorp does not believe the same acute availability issues currently exist for home and contents insurance in northern Australia,” Insurance CEO Gary Dransfield says in the submission.

“This has been confirmed by the ACCC’s investigations, which found eight insurers supply most of the home and contents insurance policies in the region. In short, there is no market failure.”

The reinsurance pool concept was explored four years ago by the Northern Australia Insurance Premiums Taskforce, which found mitigation was the better approach to tackling issues in the region.

Suncorp says the US National Flood Insurance Program (NFIP) has hindered progress on land use planning and managed retreats from high risk areas, with a focus on rebuilding that potentially traps people in a cycle of “flood, rebuild, repeat”.

The submission cites a property near Baton Rouge, Louisiana, which has been flooded and rebuilt 40 times, as well as a Houston, Texas, home worth $US72,400 ($106,213) which has received more than $US1 million ($1.47 million) in payouts from the NFIP.

“Diluting the insurance price signal and politicising insurance premiums inevitably fails, with governments effectively locked in to providing low-cost insurance as risk exposure increases,” the insurer says.

Suncorp repeats its call for increased government investment in mitigation and suggests that an alternative to direct government funding could also involve using the Northern Australia Infrastructure Facility to provide concessional loans for public mitigation works and household-level upgrades.

It says north Queensland alone has as many as 100,000 homes that may not meet wind load codes for roofs and other building features, and insurers must price for that risk.

“Government intervention in the northern Australia home and contents insurance market, through a reinsurance pool or insurance mutual, has been investigated extensively and found to be unviable and too costly,” Mr Dransfield says.

“The only sustainable way to address affordability is to invest in building more resilient communities.”