Education is the answer: CGU
CGU has called for a joint industry/government education program to help tackle underinsurance.
In a wide-ranging submission to the Victorian Bushfires Royal Commission it released this morning, the insurer recommends improved public awareness measures on the need for insurance.
While 30% of Victorian bushfire victims had no property cover, CGU handled 1300 claims representing more than 2900 separate losses.
Its submission also makes recommendations on such matters as insurance taxes and criminal penalties for arson.
It says government and community input into an education program on insurance is critical because insurers don’t directly communicate with the uninsured.
“There is a strong rationale for this because generally only those who have insurance will receive or have access to the information they require to be fully covered,” the submission said.
While it acknowledges the merit of government and community help for uninsured and underinsured victims, CGU warns that “when government or the community take on the role of insurer of last resort”, such measures can “perpetuate the behaviours that led to the assistance being needed in the first place”.
It says government and community assistance for bushfire victims reduces the incentive for private insurance, leads to “windfall gains” for fully insured residents and drains public funds.
In a wide-ranging submission to the Victorian Bushfires Royal Commission it released this morning, the insurer recommends improved public awareness measures on the need for insurance.
While 30% of Victorian bushfire victims had no property cover, CGU handled 1300 claims representing more than 2900 separate losses.
Its submission also makes recommendations on such matters as insurance taxes and criminal penalties for arson.
It says government and community input into an education program on insurance is critical because insurers don’t directly communicate with the uninsured.
“There is a strong rationale for this because generally only those who have insurance will receive or have access to the information they require to be fully covered,” the submission said.
While it acknowledges the merit of government and community help for uninsured and underinsured victims, CGU warns that “when government or the community take on the role of insurer of last resort”, such measures can “perpetuate the behaviours that led to the assistance being needed in the first place”.
It says government and community assistance for bushfire victims reduces the incentive for private insurance, leads to “windfall gains” for fully insured residents and drains public funds.