NSW Budget Prioritizes Resilience, Aimed at Insurance Affordability
NSW Budget Prioritizes Resilience, Aimed at Insurance Affordability
17
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
The latest NSW budget signals a significant boost for improving insurance outcomes by heavily investing in resilience building and working towards emergency services levy reforms.
Unveiling the 2024-25 budget, the Minns government has announced a substantial allocation of $5.7 billion over the next four years focused on disaster response and natural calamities, with Australian government contributions included.
Among the key initiatives, $525 million is set aside for the Resilient Homes Program in the Northern Rivers and Central West, promoting voluntary home buybacks and flood-proofing just to name a few enhancements. Meanwhile, the Resilient Lands Program will receive $87.4 million aimed at creating new housing and land opportunities in Northern Rivers.
"The focus on resilience is truly commendable," stated Andrew Hall, CEO of the Insurance Council of Australia. "By proactively addressing the need to safeguard properties and human lives from the increasing menace of severe weather, the government is paving the path for improved insurance scenarios."
An equally notable aspect of the budget is the government's renewed commitment to replacing the current insurance-based emergency services levy (ESL) with a property levy mechanism.
According to the budget documents, growing needs for emergency services spurred by climate change and frequent natural disasters are driving the push for change. The documents mention, "Transitioning from the ESL to a broader-based property levy would alleviate the pressure on insurance premiums and distribute the cost more equitably among all property owners."
Insurers have long been advocating for such reforms. Mr. Hall praised the move, remarking, "Eliminating the ESL will definitely reduce insurance costs for customers in NSW. The existing system has long penalized policyholders especially those living in flood-prone areas, already burdened by hefty insurance premiums."
IAG, another major player in the insurance arena, also lauded the budget. Nick Hawkins, CEO and MD, commented, "Measures like voluntary home buybacks, planned relocations, house raising, and retrofits are critical. These steps will not only enhance safety but also secure long-term protection for residents in high-risk zones."
The budget papers project a significant growth in ESL-related revenue, estimating an uptick of $205.6 million by 2027-28 when compared to the previous half-year review of 2023-24. This increase highlights the provisioning of additional resources to elevate emergency services for the NSW community.
For the fiscal year 2024-25, the government anticipates collecting around $1.32 billion in ESL revenue, with projections for the subsequent years being $1.27 billion in 2025-26, $1.22 billion in 2026-27, and $1.24 billion in 2027-28.
However, insurance duty revenues have observed a slight decline, revised downward by $7 million for 2023-24 and by $34 million over the next four years up to 2027-28, a situation attributed to fluctuations in year-to-date collections.
From Insurance News Magazine: How Government Disaster Payouts Could Drive the Search for a "Better Way" on Climate Adaptation.
Published:Thursday, 20th Jun 2024 Source: Paige Estritori
Please Note: If this information affects you, seek advice from a licensed professional.
The National Truck Accident Research Centre (NTARC) has released its latest Major Incident Investigation Report, shedding light on the predominant causes of significant truck crashes across Australia. The findings reveal that human factors, particularly inattention, distraction, and inappropriate speed, continue to be the leading contributors to these incidents. - read more
In a strategic move to enhance the value of its offerings, TAL has announced the expansion of its Health Sense Plus program to encompass income protection insurance. This initiative, effective from 8 August 2025, aims to incentivise proactive health management among policyholders by providing premium discounts. - read more
Australia's insurance sector is experiencing a significant shift as mental health conditions become the predominant cause of total and permanent disability (TPD) claims. Recent data from the Council of Australian Life Insurers (CALI) indicates that mental health issues now account for nearly one-third of all TPD claims, marking a substantial change in the industry's claim patterns. - read more
The Australian Prudential Regulation Authority (APRA) has raised concerns about the sustainability of income protection insurance, following industry losses amounting to $2.5 billion over five years. APRA has urged life insurers to implement reforms to enhance the viability of these products and ensure they continue to meet policyholders' needs. - read more
In the fast-paced world of entrepreneurship, the only constant is change, and with change comes the inherent realm of the unknown – risk. Australian entrepreneurs, much like their international counterparts, operate in dynamic environments where unpredictability is a staple. However, the unique economic, legal, and environmental aspects of Australia demand a more localized understanding of these risks. Acknowledging this unpredictability is the first step towards mitigating potential threats to one's business venture. - read more
Running a small business can be both rewarding and challenging. One of the key challenges is the variety of risks that can arise unexpectedly. These risks can range from financial uncertainties to operational hiccups, each potentially impacting your business's success. Understanding these risks and preparing for them is crucial for the longevity and sustainability of any small enterprise. - read more
Liability insurance is a type of coverage designed to protect you from claims arising out of injuries or damages to other people or property. For freelancers, who often juggle multiple projects and clients, liability insurance can offer a safety net that reduces financial risk and instability. - read more
When it comes to navigating the complex waters of insurance, understanding public liability insurance claims is crucial for businesses and individuals alike. Public liability insurance serves as a safeguard, protecting against the financial repercussions that arise from accidents or injuries that occur on your premises or through your operations. In this introductory section, we will delve into the essence of public liability insurance and underline its significance. - read more
Start Here !
Knowledgebase
Liability Insurance: Insurance that provides protection from claims arising from injuries or damage to other people or property
