An ACT inquiry into insurance costs will consider the effect of rising premiums on business and community organisations.

The Legislative Assembly’s Standing Committee on Economics, Industry and Recreation says differences in insurance costs in the ACT compared with other jurisdictions, particularly for workers’ compensation, and the impact of climate change are among topics to be considered.

“We are particularly interested in suggestions for improving the insurance sector to make it easier for small businesses and organisations to operate in the ACT,” committee chair Taimus Werner-Gibbings said.

The terms of reference include trends in public liability claims, litigation behaviour and premiums, and barriers to accessing cover for non-governmental organisations and community initiatives.

The inquiry will consider how insurers assess risk and the extent to which public and private sector risk-reduction actions are considered, and requirements related to using government venues and facilities – and consequences of those for community sport, recreation and the creative arts.

Models for providing public sector policies for community organisations, including those operating interstate or internationally, are also included in the terms of reference.

The Canberra Business Chamber says it has been calling for action on insurance costs, which are growing beyond the means of many companies.

“Increases in insurance premiums ultimately translate into price increases for customers and make it harder for businesses to operate sustainably,” CEO Greg Harford said today.

A September-quarter Canberra Business Beat report showed 44% of companies reported premium rises of more than 20% over the past two years, with increases outpacing inflation.

Mr Harford says while there are insurance cost issues across the board, workers’ compensation is particularly problematic.

“The chamber is hearing about huge price hikes for workers’ compensation insurance, and members report that it is substantially more expensive here in the ACT than in NSW or other jurisdictions,” he said. “On the face of it, there’s no good explanation for this, but it does put ACT businesses at a competitive disadvantage compared to firms in other states.”

Inquiry submissions close on March 14, with the reporting date yet to be announced. 

More details are available here.