Probe into strata insurance hike gets Fed Govt support
A HIGH-LEVEL investigation into the massive hike in body corporate insurance premiums and a moratorium of the State Government's stamp duty on the insurances have been recommended by the Federal Government.
The recommendations have been agreed to by the Federal Government in its response to an investigation into increases in residential strata title insurance premiums in Far North and north Queensland.
Two key recommendations are:
1. Calling on the Australian Government Actuary to undertake a rigorous investigation of the causes of the recent premium increases.
2. Supporting the committee's recommendation that the State Government introduce a 12-month moratorium on stamp duty charged on strata title insurance in north Queensland.
But for one northern beaches apartment owner, who asked not to be named, it has come too late.
Her latest body corporate fees for the quarter are $2172.25, a $736.27 hike to pay for the mandatory insurance premium for their complex of $37,000, up from $9800 in 2009.
"The bill is unbelievable. This is just out of control," she said.
"The last one was $1435.98 with discount if paid before the due date of $1292.38 which I managed to scrape together and pay. But not this time, it's just not possible I'm feeling totally devastated."
A House of Representatives committee investigated the insurance industry during disaster events and held public hearings in Cairns and Port Douglas earlier this year.
The inquiry included an examination of the affordability and availability of residential strata title insurance in the region after concerns were raised about the rising body corporate insurance costs.
Cairns-based Senator Jan McLucas said the strata insurance market was failing and unit owners, body corporate managers and real estate agents had faced a difficult predicament in recent years.
"Our goal is to encourage insurers back into this market and as a result increase competition."
Senator McLucas said the insurance industry had agreed to provide the Australian Government Actuary with the data it needed to undertake the analysis and would report to the Government by September 30.
But member for Leichhardt Warren Entsch says the Government's recommendations regarding hike in residential strata title insurance is tokenism and have let down the region.
"There is clear evidence of gouging, the insurance companies are using relatively minor events in North Queensland as an excuse to walk away and cherrypick profitable markets,'' he said.
Additional reporting Caitlin Guilfoyle
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