Insurance companies who “cherry-pick” postcodes and avoid covering North Queensland properties should be banned from offering policies in the rest of the country, Federal Member for Leichhardt Warren Entsch has told parliament.


Mr Entsch addressed the Chamber on Tuesday night to reignite concerns about the “continued failure” of the insurance industry in FNQ and to put renewed pressure on the government’s review process.


The government has a deadline of October 1 to complete the series of reviews recommended by the Standing Committee on Social Policy and Legal Affairs when it tabled its second “In the wake of disasters” report in March.

“During the inquiry, I heard heart-breaking stories from people in my electorate who are suffering huge financial pressures due to the skyrocketing costs of insurance, the total unaffordability of insurance and, in many other cases, the lack of availability of insurance for their properties,” Mr Entsch told parliament.

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He commended Committee Chair Graham Perrett for his report, but added that with the halfway point of the allocated period for the review approaching, he hoped good progress was being made.

Since the public inquiry took place in late January, Mr Entsch has continued to receive numerous examples of insurance quotes that have gone through the roof.

“One letting agent in Cairns, Linda Tuck, reported that last year the cost of insurance for a two bedroom, one bathroom duplex with a value of around $350,000 was $941.

“This year, she was told that the insurer, Lumley, had withdrawn from domestic property insurance for all locations above Mackay.

“With only two insurers willing to quote, the prices jumped to the ridiculous level of $4803 with Vero and $4439 with CGU.”

Mr Entsch said that in his view, it was blatantly obvious that the market had failed.

“These companies are acting in a discriminatory way in Northern Australia and what they are doing is, I believe, both criminal and disgusting,” he said.

The government has until December 1 to outline how they will bring affordable.