Insurance premiums 'could rise in wake of floods'

Mozo

Monday 17 January 2011

Insurance companies are likely to push through a fresh round of premium increases following a recent spate of natural disasters, including the Queensland floods.

Insurance premiums 'could rise in wake of floods'

An investigation by the Sydney Morning Herald found that the big insurers are becoming more discriminatory in their pricing policies following major pay-outs since the start of 2009 "on disasters ranging from the Victorian bushfires to freak hailstorms".

Any such pricing changes could encourage Aussies to compare car insurance and other products, particularly if premiums rise. Speaking to the newspaper about the issue, Stuart Alexander, an insurance specialist with Deloitte, pointed to the difficult circumstances currently facing insurers.

''They talk about one-in-a-100-year event. Well, we had a one-in-a-100-year event in the bushfires, we had a one-in-a-100-year event in the floods in Brisbane, as well as the hailstorms in Perth and Melbourne and the earthquake in Christchurch,'' he said.

It was also revealed that, according to Deloitte estimates, car insurance premiums rose five per cent last year while house insurance premiums increased by as much as nine per cent.

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