Low-income households face “insurance exclusion” due to rapid premium rises, according to a report from the Northern Territory Council of Social Service (NTCOSS).

Its 10th Cost of Living Report shows insurance prices in Darwin have increased at twice the CPI rate for the past 15 years.

The increase in the past year was even more pronounced – up 2.3%, above the national rise of 1.6% and almost six times the increase in CPI for Darwin, at 0.4%.

Territory households on average spend nearly $1500 more per year on insurance than in 2009, the report says.

NTCOSS Policy Adviser Jonathan Pilbrow says high prices for cover add to the “already high cost of living for Territorian households”.

“Rising insurance prices create a financial barrier for low-income households to take up or maintain insurance options, increasing their vulnerability to the impacts of life events such as unexpected illness, accidents or natural disasters,” he said.

NTCOSS says with climate change and the increasing incidence of extreme weather events, the “insurance system” must be made more accessible.

“It is concerning that it is low-income and disadvantaged groups who suffer the worst outcomes when extreme weather events occur,” Mr Pilbrow said.

NTCOSS has called for the removal of disincentives to insurance, such as taxes and levies applied by states and territories, under a national reform process.

Allianz, which acquired the Territory Insurance Office from the NT Government in November last year, says it is misleading to measure increases in insurance costs against the CPI.

“All areas of Australia saw marked rises in home insurance premiums following the large natural catastrophe events over the past five or six years, driven particularly by increases in reinsurance costs after the events of 2011, specifically the southeast Queensland floods and Cyclone Yasi,” Allianz spokesman Nicholas Scofield told insuranceNEWS.com.au.

“In light of the external factors that can drive insurance prices, comparing them with generic CPI measures may be of academic interest but does not provide much practical insight into anything.”

As insuranceNEWS.com.au reported last week, the Northern Australia Insurance Premiums Taskforce has handed its final report to the Federal Government. However, there is no indication on when it will be made public.