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Wednesday, 9 May 2012
Page: 4484

Dr STONE (Murray) (19:28): I have a minute and a half left, which is, sadly, not enough to do justice to this report—from an excellent inquiry—In the wake of disasters: VolumeTwo: the affordability of residential strata title insurance. It was particularly in relation to the affordability of residential strata title insurance in northern Australia.

We have a lot of bad weather in northern Australia; that goes without saying. The trouble is that we have total market failure now when it comes to insurance, particularly for bodies corporate in residential strata title structures. We found in this inquiry that there was real tragedy occurring. People had sold their properties down south in Australia, had bought their dream apartments up north and now face body corporate insurance payments, divided up, obviously, between the number of units in that dwelling. The cost of that insurance is now well beyond the capacity of those, often retired, people to pay. There is virtually only one insurer left in the market, and in some cases even that one insurer quotes such unrealistic prices for the insurance product that you can say that in effect there is complete market failure.

We made a number of recommendations which were very important. We want the government to look closely at the problem of why there was heavy discounting in the price of that insurance some time ago, which drove others in the marketplace out of contention. We want to have a 12-month moratorium on stamp duty charges on strata title insurance for properties north of the Capricorn, and we felt that should be implemented in the next financial year.

Debate adjourned.

Federation Chamber adjourned at 19:31