Council steps up fight for lower insurance costs

Date published: 28 May 2019

Townsville City Council is calling for immediate State and Federal Government taxation reforms to reduce crippling household premiums in the north.

Townsville Mayor Jenny Hill said changes in the way GST and stamp duty was levied on insurance policies would reduce the cost of premiums which in the north were double that of southern households.

The recommendation forms part of the council’s detailed submission to the ACCC’s Inquiry into Insurance costs in Northern Australia.

“Something has to be done about the inequity Townsville residents and our northern neighbours face on insurance costs compared to the rest of Australia,” Cr Hill said.

“Already the ACCC inquiry has confirmed that we are paying twice as much for insurance as people in other parts of the nation and that is simply unacceptable.

“In our submission to the inquiry we have called on the State and Federal Governments to do more to alleviate the high cost of premiums.

“As if paying double for our premiums isn’t bad enough, the problem is compounded by the fact that the State and Federal Governments also apply stamp duty and GST charges on top of this impost. Why should the north pay double the tax on our insurance.

“In Council’s submission, we’re saying that the taxes should be levied on the insured amount rather than the insurers calculated premium which is currently the case.

“But we also need the insurance industry to give people a fair go.

“Detailed data on the plight of the north on insurance is important to reduce the impact of insurance costs and shine a light on the shortcomings of the insurance industry.

“That’s why the enormous impact of this year’s natural disaster and the experience of the city’s residents, both good and bad, is a prime opportunity for the ACCC to conduct a sub-regional case study on the city.

“Our submission puts forward the call for the ACCC to work with Council, the community and the insurance industry to reduce the impact of insurance costs.

“As part of our broader recovery effort, the council is liaising with insurers, residents and the Insurance Council of Australia on the insurance Industry’s response.

“In our discussion with the ICA they have indicated their support for the case study.”

Cr Hill outlined the council’s submission at a full meeting of council today.