Fire services funding should be fair says CGU

CGU Insurance has asked the Victorian Government to implement a fairer funding model for fire services – a system that doesn’t discriminate against property insurance holders.

CGU’s CEO Duncan West said “The current funding model for the Victorian fire services is grossly unfair. It unfairly penalises the members of the community – those with property insurance – by enforcing them to carry the burden of funding fire services for the broader community. The Fire Services Levy is applied to the total premium of property insurance policies. As these policies are compiled after assessing numerous risks, not solely the risk of fire, it creates an imbalance between funding levels and potential fire risks. The option of replacing the FSL with an across-the-board property tax is a step in the right direction, but we believe it needs to go further to consider the responsibilities of motor vehicle owners.”

West continued, “CGU regularly hears first-hand how excessive taxes and charges on insurance impact our customers and, in particular, how the resulting increased premiums can discourage people from taking up full, or in fact any, insurance protection. We hear almost daily from customers who make claims only to realise they were not adequately insured. CGU believes fire services should be funded through property rates and motor vehicle registrations. This would more accurately reflect the 15 per cent of MFB callouts and 10 per cent of CFA callouts attributed motor vehicles. Fire services are an essential component of a safe community, but the current funding system is unfair, inadequate and inefficient.”