Flood works to sweeten TIO sale

TIO

Residents of flood-prone Katherine have been promised up to $20 million in funding for mitigation works as opposition mounts to the sale of Territory Insurance Office (TIO).

Hundreds of residents have signed a petition opposing the sale, which the Northern Territory Government is considering under the Commonwealth’s asset sale program.

Under the program, states and territories receive a federal payment of 15% of the sale price of their assets to reinvest in infrastructure.

Public opposition to the sale scotched the government’s last attempt to offload it in 2010, and many residents fear hefty hikes in premiums and loss of inclusions such as storm-surge protection if TIO is sold.

Member for Katherine and Mines and Energy Minister Willem Westra van Holthe last week told a public meeting in Katherine that the flood mitigation was the first priority for the town.

The Katherine River broke its banks in 1998, inundating large parts of the town and causing claims of around $70 million.

TIO Chief Executive Richard Harding told the same meeting that premiums would go up even if the insurer remained government-owned, as it would be forced to abandon its current method of community rating.

NT Labor MP Nicole Manison says the sale could be devastating for the region.

“The Territory Government has been warned that selling TIO could see a repeat of the insurance crisis in Queensland where homeowners are paying skyrocketing prices to insure their home, if they can even get insurance,” she says.

“If (NT Chief Minister) Adam Giles genuinely believes that selling TIO is in the best interests of Territorians then he should take the issue to the next Territory election.”

Giles has defended the proposed sale, saying that all that would change would be the owner.