The Federal Government’s announcement of a National Disaster Insurance Review has been supported by the Insurance Council Australia (ICA). The ICA suggests a range of measures need to be implemented in a bid to reduce the damage caused by serious disasters and to help communities recover more quickly from these devastating events. These have been outlined in a 10-Point Plan.
1. Standard definition for flood: Reform of the Insurance Contracts Act to include a
common definition of flood for reference by insurers that offer flood insurance (to
maintain competition and consumer choice, retain the right to derogate and amend
the definition under the ‘unusual terms’ section of the Act).
2. Improved disclosure: Industry commitment to simplify and improve insurance
product disclosure statement summary arrangements to enhance consumer
understanding of insurance cover.
3. Provision of adequate flood data: Agreement from Government to establish an
open source nationally consistent and contemporary digital terrain model, to allow the
accurate mapping of flood risks nationwide and communication of those risks by
government to property owners.
4. Removal of insurance taxes: Commitment across all Governments to encourage
greater personal responsibility in the community through implementation of recommendation number 79 of the Henry Tax Review to abolish all insurance taxes,
including fire services levies.
5. Improved land-use planning: Commitment by Government to develop national landuseplanning criteria that prohibits inappropriate land-use in Australia.
6. Improve building standards: Commitment by Government to improve the
community’s disaster resilience by modernising the Building Code of Australia to
include minimum standards for the durability of property to natural hazards.
7. Improve community infrastructure: Recovery funds dedicated to preventative
infrastructure projects including levees, barrages, flood gates and improved drainage.
8. Education and financial literacy campaign: Government and industry commit to a community education campaign to increase awareness of insurers’ obligations to
consumers and dispute resolution arrangements. This includes promoting the
insurance industry Code of Practice.
9. Measure effectiveness of disaster relief payments: Introduce annual reporting by the Productivity Commission on the effectiveness of State and Federal disaster relief payments.
10. Better advice to consumers: Commitment by Government to ensure the advice
provisions in the Corporations Act do not impede discussion between consumers and
insurers on appropriate insurance cover needs
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