Greens push to cut home insurance costs by $4bn through polluter pays, scrapping stamp duty fees, extending Reinsurance Pool

The Greens will announce a mega policy push which it claims could lower rising insurance costs by $4bn amid surging premiums due to the increased risk of natural disasters. Opposition Leader Peter Dutton has also placed the industry on notice, threatening divestiture powers on insurance giants found to be unfairly hiking costs. The minor party’s five-point plan includes Commonwealth incentives to scrap the insurance stamp duty collected by state government on house and car insurance, expanding the Cyclone Reinsurance Pool (CRP) to include all natural disasters and forcing coal, gas and oil companies to contribute to the Disaster Ready Fund and Reinsurance Pool, due to their affect on emissions and climate change. Initiated in 2022, the CRP forces insurers to contribute to the fund which is then used to lower premiums for households and businesses at high risk of damage from cyclone and related flood events. The Greens’ plan also includes giving the consumer watchdog, the Australian Competition & Consumer Commission powers to force insurers to disclose its premium pricing arrangements, plus a $10m “risk map” to identify communities at risk from climate-induced natural disasters like cyclones, floods, fire, and storm surges. Costings done by the Parliamentary Budget Office state the policy changes, namely abolishing stamp duty fees, the expanded Reinsurance pool and the polluter pays policy could save households $4bn in the first year. Deputy Greens Leader Mehreen Faruqi will launch the announcement on Wednesday in the northern NSW seat of Richmond, currently held by Assistant Minister for the Prevention of Family Violence and Social Services Justine Elliot. Senator Faruqi will appear alongside Greens candidate Mandy Nolan, with the minor targeting the marginal seat in the federal election, due by May 17. Reductions in stamp duty for insurance would dent the budget bottom line by Senator Faruqi said there was a “real lack of transparency and clarity,” which enabled companies to “price gouge and exploit the climate crisis to increase profit margins”. “Families, renters and retirees should not have to pay skyrocketing insurance premiums for a climate crisis they did not cause,” Senator Faruqi said. “Filthy rich coal and gas companies caused the climate crisis and they should pick up the tab. “People’s insurance premiums are skyrocketing with no explanation as to why. “Consumers have a right to know how their premiums are being priced and deserve a meaningful explanation of why they are doubling and tripling in price.” Separately, Health Minister Mark Butler has repeatedly rejected private health insurance premium increases ahead of the April 1 deadline, calling on proposed fee increases to be “justified and proportionate”. On Tuesday Nationals Leader David Littleproud appeared to water down the Opposition Leader’s divestiture threat to insurers who amp up premiums in areas prone to natural disasters. According to Choice, Australia’s big four insurance firms including AIG, Suncorp, Allianz and QBE dominate about 75 per cent of the market, with most brands subsidiaries of those parent companies. Mr Dutton placed companies “on notice” and said it was “unacceptable” for people to go with insurance for public liability, their cars, or businesses due to premium increases of “20 or 30 or 40 per cent”. “I want the free market to operate but if it’s failing, and if consumers aren’t being treated appropriately, and if people are put into a position where they can’t get basic insurance – then, that’s a significant failure,” he said. “Australians can’t afford those sort of premiums, so the insurance companies need to concentrate on how they’re going to fix the problem.” However Mr Littleproud said any measures would be done “carefully and methodically”. “If we go down that path, we’ll make sure it’s a careful, methodical approach but what Peter has said and what the Coalition is saying to the insurance companies, you’re on notice, and we’ve got form of standing up to big corporates,” he said. “I think we’ve got to a juncture where we’ve got to have greater transparency about that pricing and how they’re actually working through these numbers and what they’re factoring into it.” The policy reveal, however, was criticised by Warringah Teal independent Zali Steggall as a “populist thought bubble”. Instead, she said the catastrophic weather events were driven by climate change, and called on the Coalition to put forward a “credible climate and energy policy”. “Peter Dutton’s threat to break up the country’s insurers is a populist thought bubble so deeply anti-free market that it is hard to reconcile it is a policy coming from the Liberal Party,” she said. “We can’t insure our way out of the climate crisis, but we can make our communities and our economy more resilient and put downward pressure on climate disaster related costs.”