Insurers should stump up $250 million a year to support disaster risk mitigation and affordability and availability of cover, the Australian Consumers Insurance Lobby says. 

This would address what it calls a growing crisis in the insurance market.  

ACIL chair Tyrone Shandiman says sharing the $250 million cost between all Insurance Council of Australia members would represent “a mere blip on their balance sheets”. 

“Insurers should return some of their record profits to policyholders instead of prioritising shareholder returns,” he said. “It is time for insurers to show they are part of the solution rather than merely calling for government action. Insurers cannot continue to shift responsibility.” 

The funds would support mitigation projects in high-risk areas, provide premium relief for vulnerable consumers, establish a research foundation to explore long-term affordability and availability solutions, and allow trial programs to support the case for major government spending. 

ACIL says insurers must be willing to contribute financially if they “truly believe” in the benefits of mitigation and resilience measures. 

Mr Shandiman says the fund would be a “meaningful step towards restoring trust and improving public perception. 

“Insurers continue to only propose solutions that do not require them to contribute financially. This approach ... raises questions about their commitment to genuine reform. Insurers are experiencing record profits while consumers in high-risk areas struggle to obtain or afford insurance.” 

ACIL says the funding could include trials and modelling to back ICA’s proposed $30 billion flood defence program. The council last month called on governments to make the investment over a decade as home insurance affordability concerns grow. 

ICA told insuranceNEWS.com.au it “notes Mr Shandiman’s idea”.