ADVOCACY: Reducing the cost of Insurance


4 February 2021 Townsville Chamber Budget Submission 

30 March 2022, the Parliament passed the Treasury Laws Amendment (Cyclone and Flood Damage Reinsurance Pool) Bill 2022 to establish the reinsurance pool for cyclone and related flood damage, covering residential, strata and small business property insurance policies.

The cyclone reinsurance pool is administered by the Australian Reinsurance Pool Corporation (ARPC) with backing from a $10 billion Government guarantee. A Treasury?led Taskforce consulted with industry and community representatives, as well as other interested stakeholders on the reinsurance pool.

In December 2021, stakeholder views were sought on exposure draft legislation and regulations to establish the pool. The regulations were made on 31 March 2022.

On 30 June 2022, the ARPC released initial premium rates for the pool to commence as legislated on 1 July 2022. The ARPC will undertake further consultation with insurers and release updated rates by 1 October 2022.

Large insurers with Gross Written Premiums (GWP) of $300 million or more must join the cyclone pool before 31 December 2023. Small insurers with GWP under $300 million have until 31 December 2024 to join the cyclone pool.