The tides of change are upon Queensland after the Newman Government approved a $50 million mitigation plan to better protect flood-prone areas from the Gold Coast to Cairns.
The government funding will be provided to individual councils for specific projects but insurance experts have raised doubts as to whether the funding will be enough to make an appreciable difference across the state.
Community Recovery and Resilience Minister David Crisafulli says: “We’re carrying out the most ambitious infrastructure plan in a generation.”
“It will mark a turning point for communities threatened by flooding. Locals know how to best protect their community and we need to work with councils to identify a value-for-money project that could save millions of dollars in clean-up costs in the future.
“It is also the sort of project that insurance companies say will lower risk and therefore premiums. We intend to hold them to that.”
However, Queensland-based Cooper Professional Risks Director Robert Cooper says the proposed $50 million is a good start but far from the amount needed.
“I think it’s a good investment but judging by the amount of damage experienced throughout the state it’ll be spread quite thin if they expect to address all of it with just $50 million,” he says. “Insurance companies aren’t in the business of building infrastructure to help government, they’re there to create a premium pool to pay claims. If the government was willing to invest in quality mitigation it would entice insurers that have left the area to return and encourage competition and ultimately lower premium prices in that area.”
Cooper says the $50 million would be better spent on Queensland’s most vulnerable towns first in a trial to demonstrate the effectiveness of mitigation measures before being rolled out to other communities.
“The Insurance Industry is vital to Australia but it will only be effective if Governments also recognise that they have a responsibility to play their part to make risks more insurable where they can. Insurance Brokers will continue to play their part in this area too.” Cooper says.
Suncorp recently announced it was slashing premiums in Charleville in Queensland, thanks to the successful completion of a $20 million levee.