The NT Government has allocated $57.5 million of the $410.9 million it made selling the Territory Insurance Office (TIO) for flood mitigation projects.

It has appointed advisory committees for Darwin and Katherine to propose measures to reduce damage and “improve and availability and affordability of insurance cover in flood-prone areas”, according to budget papers released last week.

Draft strategies will soon be available for public consultation, with final reports to reach the Government early in the next financial year. The committees have representatives from business, the Insurance Council of Australia, local government and communities.

The NT Treasury expects to raise $44.7 million from insurance taxes this financial year and $45.07 million next year.

Treasurer David Tollner says the Government will spend $92.5 million on rebuilding and repairing facilities and housing damaged by cyclones Lam and Nathan.

He says selling the TIO insurance business to Allianz in January has allowed TIO to dilute its risk and bring its reinsurance costs into line with competitors.

“Make no mistake, TIO would have withered on the vine if it remained in government hands,” he said in the budget speech.

Mr Tollner announced the Government will abolish stamp duty on life insurance from July 1, which will cost $2 million in lost revenue. He says the move aims to reduce the cost of living.

However, trauma or disability cover added to life insurance will be taxed as general insurance, with a 10% duty on the premium.

The Victorian Government did this last year, resulting in retail and group life insurance customers paying more duty than before.

Territorians currently pay 10 cents per $100 sum insured on their life policies.