New insurer enters FNQ strata market
New insurer enters FNQ strata market
Thursday June 5 2014, 3:41pm
A new player has entered the insurance game in the Far North and is determined to shake up the market.
Sydney-based firm Brooklyn Underwriting will launch new tropical strata projects north of the 26th Parallel this week, covering risk in small-to-medium residential complexes of up to 25 units.
The 26th Parallel defines the border between the Northern Territory and South Australia.
Brooklyn property underwriter Toby Salmon said the decision had been ‘a couple of years in the making’ but was confident that the company would provide effective competition in the Far North Queensland market.
“We thought that it was a service we could provide and have a pretty good outcome from it,” Mr Salmon said from Sydney.
“A lot of insurers have pulled out of writing insurance up there and we recognised it as an opportunity.”
Mr Salmon said Brooklyns would not write off the entire region as being prone to natural disasters like floods and cyclones, with each property being individually evaluated for risk.
“We’ll be providing these products on a case-by-case basis - we have dedicated risk experts up to call on and they will evaluate every case on its merits.”
The move has been welcomed by local politicians and business leaders alike.
Federal Member for Leichhardt Warren Entsch said insurance premiums for strata had skyrocketed in the wake of previous cyclone and flood events and that the entrance of Brooklyn into the market would help drive them back down.
“We wish we could say the premiums had only tripled - we’ve seen examples of insurance increases of 1000 per cent for strata and we have evidence that it’s gone up by more than 2000 per cent in other cases,” Mr Enstch said.
“Suncorp pretty much controls the insurance market up here, they own an absolute stack of other companies so there is no real alternative. We’re looking at opening the market by doing things like reducing capital requirements for entry, and so on.
“I congratulate Brooklyn for this move - it’s refreshing to see an insurer who accepts that every strata building in North Queensland shouldn’t be lumped into the same basket of ‘not being able to withstand a cyclone’ - the view that buildings must be assessed and underwritten on their merits also ties in well with CGU’s program to assess their strata complexes.”
Douglas Chamber of Commerce head Pheobe Kitto said the presence of extra competition could only be good for consumers.
“I think it’s fantastic,” she said.
“Any competition that can be brought in and give people choice is going to benefit the community - it’s very important to have cost-effective insurance available.”
