ACCC Releases Second Insurance Monitoring Report

Home, strata and small business insurance premiums in northern Australia remained much more expensive in 2022–23 compared to the rest of Australia, the ACCC’s second annual insurance monitoring report has revealed.

In the report, released today, the ACCC observes that it is yet to see any significant widespread price effects from the government’s cyclone reinsurance pool in 2022–23, given insurers only began joining the pool at the start of 2023, and most that have joined did so on or after July 2023.

We continue to hear about the financial pressures that consumers, strata owners and small businesses in northern Australia face to obtain the insurance they need,” ACCC Commissioner Peter Crone said.

“While some consumers have expressed optimism about the potential impact of the pool and say they have experienced more choice and cheaper premiums, many others have told us how worried and frustrated they are about the impact of high and rising insurance prices on their homes and businesses.”

“The cyclone reinsurance pool is still in transition. The combination of insurers entering the pool at different times, the time required for insurers to fully implement pricing changes, and differing policy renewal cycles mean that consumers may not see the full impact of the pool on their premiums for some time. There is also a range of other factors impacting insurance premiums, such as higher building replacement costs and global reinsurance market conditions. And as we know, a changing climate is expected to exacerbate extreme weather events in future,” Mr Crone said.

“The ACCC has not been given the power to require insurers to take any particular approach to pass-through of savings, nor to require insurers to communicate their approach to consumers. However, we do expect insurers to be truthful and accurate about any representations they do make to consumers about how savings are being allocated.”

“Over time, our monitoring will help to examine the impact of the reinsurance pool on prices, costs and profits of insurance. This work should allow governments to evaluate whether the pool is in fact operating and delivering outcomes as intended, which is to reduce premiums in regions of high cyclone risk and encourage more insurers to enter northern Australian markets,” Mr Crone said.

“We remain optimistic that the pool can achieve some premium savings and benefits for consumers at higher risk of cyclones. However, our previous Northern Australia Insurance Inquiry has shown that more may need to be done through other interventions, and we will continue to monitor closely.”

Home and contents insurance

The report found that average premiums for combined home and contents insurance increased across Australia in 2022–23. North Western Australia had the highest average premium of $4,395 and increased by 4 per cent year on year, in nominal terms.

Average prices in the Northern Territory rose the sharpest of the northern regions, by 13 per cent to an average of $2,922, followed by north Queensland with a 7 per cent increase to $2,918.

In comparison, the rest of Australia experienced an increase in average home and contents insurance premiums of 15 per cent, with policyholders paying on average $1,779 in 2022–23.

Average figures can disguise much higher premiums paid by individual consumers. Analysis has shown that premiums for properties in medium to high cyclone risk regions were considerably higher.

The ACCC’s report presents pricing information for different geographic regions and illustrates the wide range of premium outcomes experienced by policyholders.

Strata insurance

The report shows that across all sizes of strata properties, strata premiums in northern Australia were both higher and had a greater spread of prices compared to the rest of Australia.

Average strata premiums in 2022–23 were highest in north Western Australia at $14,439. The Northern Territory experienced the highest increase of the northern regions at 17 per cent to an average of $9,826. North Queensland strata premiums rose 8 per cent to $9,615.

In comparison, the rest of Australia had an average strata premium of $6,181, an increase of 20 per cent.

For higher value strata properties with sums insured over $4 million, policyholders in north Queensland paid the highest median premiums at $33,118, or more than three times the median price in the rest of Australia at $10,535.

Small business building and contents insurance

As with home and strata insurance, the average premium for small business building and contents insurance was highest in north Western Australia at $6,287, an increase of 22 per cent. Premiums in the Northern Territory were second highest at $3,670 followed by north Queensland at $3,095.

The rest of Australia experienced an increase of 15 per cent but from a much lower base, to $1,930.


Reinsurance is taken out by insurers, typically to protect insurers from significant natural peril events impacting their portfolios, such as cyclones.

The Australian Government established the cyclone reinsurance pool in 2022 to help make insurance more affordable for households and some small businesses who are at high risk of cyclones. The pool, which is administered by the Australian Reinsurance Pool Corporation, supplies reinsurance to insurers without a profit margin, reducing the cost of reinsurance for insurers.

The pool provides reinsurance to insurers in relation to cyclone and cyclone-related flooding risks covered by home, contents, residential strata and small business insurance (up to a sum insured of $5 million) throughout Australia.

Large insurers are required to join the pool by the end of 2023 and smaller insurers by the end of 2024. A list of the insurers that have joined the pool is on the Australian Reinsurance Pool Corporation website. There are currently 11 insurers in the pool.

The ACCC has been directed to monitor the prices, costs, and profits of home, contents, strata, and certain commercial insurance, before and after the introduction of the government’s cyclone reinsurance pool.

The ACCC is required to provide a report at least once each calendar year during the period 1 January 2022 to 30 June 2026.

Movements in nominal terms refers to comparisons that have not been adjusted for inflation. It is useful to observe nominal changes in premiums as this is how consumers will typically read their insurance renewal invoice. Statistics which have been adjusted for inflation (real terms) can be found in the report.

Author: The Australian Competition and Consumer Commission (ACCC)

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