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Date Published : Friday, March 14, 2008
Insurance claims as a result of the recent contrasting bad weather across Australia could mean premiums rise for all Australians over the next few months, according to an industry expert.
Since the turn of the year, storms have ravaged parts of far-north Queensland and north New South Wales. The current heatwave gripping Adelaide has broken the record for the hottest consecutive period in a capital city, with tarmac melting and admissions to hospital increasing by the day.
As a result of these weather extremes, more people than usual have claimed on their insurance - whether it be home, health or motor insurance.
A pre-Christmas hail storm in western Sydney cost insurance companies almost $400 million after a number of homes and vehicles were damaged. In total, three separate weather occurrences which happened between March 2006 and December 2007 cost the industry more than $2.4 billion.
Insurance companies are likely to recoup the losses through higher premiums over the next 18 months.
Brian Greig, head of KPMG's insurance group, told the Australian Associated Press: The past six months may have changed the risk landscape significantly.
"It is now imperative that insurers re-examine their pricing models.''
In a wide-ranging report on the Australian insurance industry, Mr Greig added: "Premiums are likely to rise and insurers need to socialise the new context in which they are operating to the community that depends on them for peace of mind."
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