Australian Prudential Regulation Authority (APRA) Deputy Chairman Helen Rowell says a lack of national data on underinsurance or non-insurance has become apparent as the regulator has examined cover availability issues beyond the cyclone-related problems.

“It’s something that we’ve been looking into as we look at what our role is in helping to solve some of the affordability and availability challenges,” Ms Rowell told a Senate committee inquiry examining the cyclone pool legislation.

“A key is that there are pockets of data in many places, but it’s not comprehensive and it’s perhaps not drawn together in a way that enables a good and robust fact base to be developed to understand some of these issues.”

APRA Senior Manager, Policy Ann Dobinson told the committee that improved data would provide an evidence base for government and insurers in looking at where insurance gaps are most severe or growing at the fastest rate, and where there’s a need for policy or industry action.

“Given that APRA does have expertise in both data collection and analytics, we’re looking to see what the data is that could help us to understand this,” she said.

University of Melbourne Postdoctoral Fellow Antonia Settle told the committee the inability to meet insurance costs was a wider problem than northern Australia but there is a lack of detailed information.

“Why this has become such a crisis without being addressed by policy is because there is no data, there is no data on underinsurance or uninsurance,” she said. “We don't know how many people are uninsured, but in the wake of every disaster there are small studies, and it’s always shocking how many people are underinsured.”

Dr Settle says the proposed reinsurance pool legislation is important as a first policy response, but is a geographically limited “blunt instrument” that doesn’t address low-income household needs or tie-in household mitigation.

“I want to draw attention to the fact that the unaffordability of insurance has rapidly become a national problem and that this reflects the beginning of price realignments in real estate as climate change starts being priced into markets,” she said.

A real estate pricing shake-up could increasingly see those on low incomes buying cheap houses in high-risk areas, where they can’t afford insurance, with implications for the social fabric of society, she said.

“We are seeing the cost of climate change being priced into markets, and that’s really what’s at the crux of the insurance crisis we're seeing across the country,” she told the committee.

Australian Competition and Consumer Commission (ACCC) executives also said “decent estimates” of non-insurance had been difficult to find for northern Australia and it shared the view that there were “some gaps in information”.