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Insurers welcome $200 million resilience promise

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Insurers have welcomed a Federal Labor pre-election promise to invest up to $200 million a year on disaster prevention and resilience.

The Insurance Council of Australia (ICA), which has long called for increased mitigation spending, says the commitment would meet a Productivity Commission recommendation.

“Regardless of the outcome of this year’s election, the next Australian Government needs to invest in stronger homes and infrastructure that makes communities more resilient in the face of worsening extreme weather,” CEO Andrew Hall said.

“The process of allocating investment in publicly funded resilience projects and infrastructure must be data-driven, independent of the political process, require business cases to support high-value projects, and be followed up with analysis of the project’s impact.”

Labor said last week it will revamp the Emergency Response Fund to release money for projects such as levees, sea walls, cyclone shelters, evacuation centres, fire breaks and telecommunications improvements.

“If matched by state, territory or local governments, it would provide up to $400 million annually for investment in disaster prevention and resilience,” Labor Leader Anthony Albanese and Disaster and Emergency Management Spokesman Murray Watt said.

Labor says its Plan for Disaster Readiness will “assist with spiralling insurance premiums in disaster-prone regions by reducing the risk of expensive damage to homes and businesses”.

IAG CEO Nick Hawkins says a greater focus on preparing communities before disasters strike is a positive step forward.

“Today, across the country, we have communities suffering the impacts of cyclones, floods and bushfires,” he said. “It’s critical that we continue to see focus and investment from all levels of government on identifying opportunities for protecting vulnerable communities, and making it happen.”

Suncorp CEO Steve Johnston says the Labor commitment and recent budget funding proposed by the Federal Government means the issue of disaster resilience will feature prominently in the upcoming election.

Mr Johnston has also reiterated calls for action to address inefficient taxes and levies built into premiums, contributing to affordability issues and costing taxpayers billions of dollars each year.

“Given the ballooning state and federal debt levels and structure of the system, we need comprehensive tax reform,” he said.

The Federal Government is set to release its pre-election Budget in late March, with voters expected to go to the polls in May.