Tourism businesses including caravan parks, hotels and boat operators have issued stark warnings on insurance availability during the current hard market in submissions to an inquiry.

As insuranceNEWS.com.au has reported, the Australian Small Business and Family Enterprise Ombudsman called an inquiry earlier this year to investigate insurance practices and cover availability after receiving complaints about policy denials and soaring prices.

Now the ombudsman has published 26 submissions, in advance of a final report that should be completed before the end of the year.

The feedback is dominated by submissions from the tourism sector, with many from under-pressure caravan parks.

Caravan park businesses and associations say that a lack of available insurance and spiralling prices could spell the end of a multi-billion-dollar industry which is a huge employer in regional areas.

“Access to affordable and adequate insurance coverage is crucial to the ongoing viability of the sector,” the Caravan Industry Association of Australia says.

“However, in recent years, caravan park operators are increasingly expressing their difficulties in obtaining coverage, excessively high premiums, limitations on policy extensions and reduced options in the market.”

Big4 Holiday Parks says areas with increased natural disaster risk are particularly hard hit.

“If this issue is not fixed in the next couple of years, it is likely that the industry will be brought to its knees with investment stopping and facilities and activities being removed,” its submission says.

Other tourism-focused sectors across the country are also suffering, with the future of adventure tourism under threat.

Tasmania’s Huon River Jet Boats told the inquiry that despite contacting about 40 underwriters not one was prepared to take on its risk, despite its excellent safety record.

“Adventure tourism thrives in New Zealand but this is only because of the foresight of the New Zealand Government in creating the Accident Compensation Commission and providing business with a stable insurance environment in which it can operate,” its submission says.

“For adventure tourism to survive and thrive within Australia a similar system to that in New Zealand needs to be implemented.”

WA’s Margaret River Busselton Tourism Association reports that many businesses have been “refused insurance”.

“The future of these professional tourism businesses is seriously threatened as they are unable to access or afford insurance for their operations. Specifically, the businesses affected either cannot get terms for cover, or face unaffordable increases in premiums, with the result that operations are no longer viable.”

Queensland remains an area of concern with the Queensland Hotels Association warning that hotels “large and small” are facing difficulties.

“Insurance for hotel businesses is a practical and legal necessity, for both property and public liability coverage,” it says.

It says Lloyd’s had traditionally underwritten most policies, but it has retreated and there is “a lack of alternative underwriting markets”. Many small businesses are either closing or in “an extremely vulnerable position”, it says.

The owners of Hamilton Island put forward a submission outlining a 300% insurance increase in four years from $1.7 million to $5.2 million.

“Over the past decade we have seen our own ability to obtain any insurance cover from the Australian market whittle to zero,” they write. “In recent years we have been required to place our insurance in the London market.”

They join other Queensland submissions in calling for further investigations into a government-backed cyclone reinsurance pool.

The Whitsunday Charter Boat Industry Association warns of an “alarming trend towards a monopoly market, sky-rocketing premiums and increasing cyclone-related deductibles,” while the Marina Industries Association says marinas across the country are struggling to access affordable cover.

Other submissions highlight the professional indemnity woes of financial advisers and property professionals.

Click here to read the submissions.