ARPC welcomes ACCC’s findings on premium reductions

22 July 2025

Australian Reinsurance Pool Corporation (ARPC) welcomes the Australian Competition and Consumer Commission’s (ACCC) fourth insurance monitoring report, which confirms that premium savings are being delivered to households and small businesses in medium to high cyclone risk regions.

According to the ACCC’s fourth annual insurance monitoring report, policies in medium to high cyclone risk areas (as measured on a per $100,000 sum insured basis), have seen marked reductions since insurers joined the cyclone pool:

• Average home and contents insurance premiums in medium to high cyclone risk areas decreased by 11 per cent compared to premiums before the cyclone pool took effect. Premium reductions were most prominent in coastal areas of north Western Australia and north Queensland, particularly in Mackay, Cairns, and Townsville (where median premiums reduced by approximately 15 per cent).
• Average small business (SME) premiums in medium to high cyclone risk areas decreased by 24% after insurers entered the pool. Areas that saw the greatest decreases were around Karratha and Exmouth
• Average strata insurance premiums reduced by seven per cent in medium to high cyclone risk regions.

The report confirms that reinsurance costs have decreased in northern Australia while remaining stable or increasing in the rest of Australia, demonstrating the pool is working as designed to provide targeted support to cyclone-prone regions.

ARPC Chief Executive Dr Christopher Wallace said: “We welcome the ACCC’s independent findings that the cyclone pool is achieving its core objectives. The results reflect meaningful progress in policyholder outcomes across northern Australia.”

The ACCC report also highlighted broader market pressures – including extreme weather and rising construction costs – continue to impact premium levels, and that overall insurance affordability remains a critical challenge.

The report noted observations about limited risk mitigation uptake. ARPC remains committed to working with insurers to improve awareness and implementation of cyclone risk reduction measures. The recently introduced strata mitigation discounts represent an important step in expanding these incentives for risk mitigation.

Dr Wallace added: “The cyclone pool is one lever to improve affordability outcomes for medium to high risk cyclone areas. We urge all insurers to continue recognising and rewarding mitigation efforts – such as cyclone shutters and reinforced roofing.”

As the cyclone pool continues to mature, ARPC will focus on enhancing its data analysis capabilities to support ongoing improvements in pricing and risk assessment.

The report provides comprehensive analysis of the pool’s performance since all eligible insurers joined by the statutory deadline of 31 December 2024, representing the first complete assessment of the pool’s impact across the insurance market.

For media inquiries, please contact Alexander Drake, Head of Public Affairs and Communications on (02) 8223-6777 or [email protected]