QBE executives championed the Hazards Insurance Partnership as key to limiting price increases at last week’s session of the Senate inquiry into the impact of climate risk on premiums. 

Chief underwriting and transformation officer Andrew Ziolkowski said the collaborative effort to create a national data asset for risks to individual homes will be critical in ensuring transparency on pricing decisions.

“I think that would go a long way to helping people understand the nature of their risk ... and how that impacts overall pricing outcomes,” he told the inquiry.  

Mr Ziolkowski said it is best to “price down to the individual property level” rather than make assessments based on a greater area, such as by postcode.  

“We think [it is] obviously the most competitive and fair way of reflecting the individual risk,” he said.    

Inquiry committee member Senator Tony Sheldon quizzed the executive on strata insurance arrangements and whether insurers should play a role preventing excessive broker commissions.  

Mr Ziolkowski acknowledged some fees “appear to be a high amount” and said further examination was needed to ensure clients have transparency on what they are paying for.  

“I think the question is then more about making sure that the owners’ corporations are aware this fee is being charged over and above the standard commission and there is full transparency in the reporting to the clients around that additional fee, particularly when there is a strata manager involved in arranging insurance,” he said.  

Earlier in the session, QBE CFO Chris Esson addressed the role of mitigation and the removal of state taxes in easing premiums.  

“As we see the gap between insured and uninsured losses widening globally, effective action aimed at future-proofing our vulnerable communities and the national economy is a priority, now more than ever,” he said.  

“After natural peril risk, the second-biggest component on the cost of insurance premiums is taxation. Removal of state insurance tax would provide swift relief to households and should be an immediate priority for governments.”  

He also addressed the insurer’s recent profit results, saying there are “multiple factors that may contribute to the overall profitability”, including higher investment returns.

See Analysis.