The Insurance Council of Australia has welcomed the final report from a parliamentary inquiry into the cyclone reinsurance pool, highlighting its focus on broader affordability measures.

The Joint Select Committee on Northern Australia published the report on Friday, urging the federal government to continue supporting the pool.

The scheme, set up by the Morrison government in 2022 to tackle soaring premiums in the north, is backed by a $10 billion government guarantee. It covers cyclone damage and cyclone-related flooding for home, strata and some small business insureds up to 48 hours after a cyclone ends.

The report says the pool should continue because it is having a positive “if limited” impact on premiums, but it also recommends the government support mitigation and investigate insurance taxes.

“ICA has long advocated for a holistic approach to improving insurance affordability and accessibility in northern Australia,” an ICA spokesman said.

“We’re pleased to see the report acknowledge critical areas we have been advocating for, for some time: particularly the increased focus on mitigation and resilience programs, which is key to addressing the underlying risk driving insurance premiums, and state tax reform.

“While we support the cyclone reinsurance pool’s intent to improve affordability and availability for cyclone-prone communities, we continue to advocate for targeted risk reduction as the most effective long-term solution to ease pressure on insurance costs.”

See ANALYSIS.