Insurers will be seeking commitments to boost disaster resilience and improve cover affordability in tomorrow night’s federal budget.

The Insurance Council of Australia’s pre-budget submission called for $250 million a year, matched by state and federal governments, to pay for home-raising and buyback projects.

The proposed fund would act separately from the $200 million-a-year Disaster Ready Fund, which ICA says should be extended to a 10-year rolling program.

The Insurance Council also seeks tort reform to help address public liability affordability issues, and floats the idea of government involvement in reinsuring catastrophic cyber risk.

Tax reform remains high on its agenda, with ICA saying federal, state and territory treasurers, through the Council of Federal Financial Relations, “should consider ways to remove stamp duty on insurance as a means to improve affordability of insurance”.

The Actuaries Institute also pushes the case for loss mitigation and adaptation spending in its submission.

“We see a strong case for increased funding for risk reduction and climate change adaptation, particularly for affordability stressed communities,” it says.

“The funds committed to date are a good start, but the required investment to address urgent areas requiring changes is still very significant.”

A Townsville Chamber of Commerce submission, supported by 18 chambers across northern Australia, seeks an early review of the cyclone pool, and changes that include extending the 48-hour limit and ending a $5 million business limit.

The submission says retail insurance providers, as part of obtaining a licence, should be obliged to provide cover across the country, given some companies have chosen to exit northern Australia.

“If we continue to allow insurance companies not to spread the risk, insurance (an essential service) will become unattainable in Australia,” it says.

The chambers point out that northern Australia is contributing to the terrorism reinsurance pool but an event would most likely happen in the major capital cities. 

If there is no willingness from the private sector to provide affordable and attainable insurance to the entire country, “then there is no other option but for the government to provide a baseline cover for the essential services required by legislation”, they say.

The submission says collecting stamp duty on top of the GST is double taxing and unjustifiable. It also notes that, as an essential service, GST should be removed from insurance, whether nationwide or only in northern Australia where there has been a market failure.

Treasurer Jim Chalmers will deliver the budget in federal parliament at 7.30pm tomorrow.