The Federal Government has allocated $12 million to the National Insurance Affordability Initiative for the 2015/16 financial year, with all the funds earmarked for Queensland.

This compares with $5 million in the current financial year.

The funds will be used to build a flood levee in Roma and improve flood defences in Ipswich, according to federal budget papers.

A levee was built in Roma in 2013/14 after Suncorp controversially withdrew from writing new cover in 2012, citing lack of progress on flood mitigation.

Finalisation works are under way on the stage-one levee, but Maranoa Regional Council has a long-term mitigation program and will use the new funding to start work on the remaining stage, including levees and drainage, Mayor Robert Loughnan told insuranceNEWS.com.au.

A Suncorp spokesman welcomed the investment in Roma, and says the insurer reduces premiums where risk is lowered.

“It’s one of the smartest investments governments can make, particularly in disaster-prone areas,” he said. “The Productivity Commission recommends a significant increase in mitigation funding by governments. It’s the best way to reduce premiums and improve affordability.”

The Federal Government last year announced a $10 million grant to Ipswich, which has experienced major flooding in recent years.

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