Having governments fixing up the insurance industry is like putting Dracula in charge of the blood bank, according to Canberra academic Terry Dwyer. Writing in the Australian Financial Review last week, Mr Dwyer, a visiting fellow at the Australian National University’s Centre for Development Studies, said governments in Australia are “sucking out” up to half the premium in taxes.

Condemning the “absurdity” that insurance in Australia is taxed more heavily than gambling, Mr Dwyer said cumulative state and federal taxes have a massive impact on its viability. “Only if governments wish to discourage self-provision and promote feckless reliance on handouts would taxing insurance make any sense”.