Latest ARPC report suggests home insurance affordability improving in Northern Australia

03 May 2024

An analysis released today by Australian Reinsurance Pool Corporation (ARPC) suggests that general insurance affordability is now improving for people living in cyclone-prone regions across Australia.

The Cyclone Reinsurance Pool Premium Assessment focuses on the cyclone pool administered by ARPC and is based on online quote data for home insurance provided by Finity Consulting, similar to that found in ARPC’s inaugural Financial Outlook Report (FOR), released in December 2023. ARPC completes this work to enhance its understanding of the impact of the cyclone pool premium rates and assess if further adjustments are required.

The FOR found in December there were signs online insurance quotes were becoming easier to obtain.

Highlights from this latest research include:

• Parts of regional centres such as Broome, Townsville, Proserpine, and Mackay are generating quotes for home insurance that are up to 38 per cent lower than they were prior to the cyclone pool’s creation in 2022.
• Small business insurance quotes for those same areas are reporting average premium reductions of 38 per cent.
• Various parts of Cairns, Ingham, and Cape York are also reporting online quotes where average reductions could be as high as 22 per cent for home insurance and 24 per cent for small business cover, again depending on the level of wind risk.

It is worth noting that these reductions are over and above any additional upward pressures on premiums in high-risk areas, such as inflation, and the changing weather environment.  They also demonstrate a key feature of the cyclone pool – that it focuses its benefit towards those areas at greater risk of cyclone damage.

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

Background on the cyclone pool

The cyclone pool was launched by ARPC in 2022 and is intended to help make insurance more affordable and more available in areas with medium to high cyclone risk, in three classes of business – household, strata (residential and some commercial), and for small to medium enterprises (SMEs).