RACQ Insurance has signed up to the cyclone reinsurance pool, the latest insurance provider to join the Commonwealth-backed scheme aimed at easing premium pressures in northern Australia. 

But the Queensland-based insurer cautions the pool alone will not be enough to address the factors that have led to soaring insurance costs in the region. 

“The pool is just one measure – more needs to be done to better protect Queenslanders such as the removal of stamp duty, increasing disaster mitigation infrastructure, home upgrades and stronger land planning and building rules,” Chief Executive Insurance Trent Sayers said. 

He says RACQ supports the introduction of the pool but the way the scheme has been designed and implemented means only marginal benefits will be achieved. 

“This is a disappointing outcome, and with a review scheduled for 2025, RACQ will continue to recommend changes to the pool’s design that will achieve maximum benefits for homeowners,” Mr Sayers said. 

“Any benefits the pool will provide will be more than offset by the affordability challenges facing the insurance industry, such as growing climate risk and inflation including significant increases in labour and building material costs.” 

RACQ says the time limit for the pool’s cover should be extended beyond two days after a system becomes an ex-tropical cyclone as the later period is when many weather systems cause most damage. 

Large insurers have until the end of this year to join the pool, which is run by the Australian Reinsurance Pool Corporation. Smaller insurers have an additional 12 months.