A group of Queensland councils have asked Marsh’s JLT to consider a mutual insurance option for regional residents and businesses hit by premium increases.

South West Queensland Regional Organisation of Councils chair Samantha O’Toole says the local governments took the step after mitigation work and talks with insurers over about five years failed to secure affordable covers for residents.

“Insurance companies are telling them that it is the flood risk that is driving premiums up,” Cr O’Toole told insuranceNEWS.com.au.

“We’ve done the mitigation work and we’re just not seeing a reduction.”

JLT-operated mutuals that provide local government cover have provided a starting point from which to consider a separate option for homeowners and businesses.

Cr O’Toole – mayor of the St George-based Balonne Shire – says preliminary work is examining factors affecting the viability of a scheme, including the size of the region.

Ideally, a business case could be ready before a roundtable in April involving the councils, insurers, Queensland Reconstruction Authority and state and federal governments, she adds.

The Balonne, Bulloo, Maranoa, Murweh, Paroo and Quilpie councils include areas hit by flooding between 2010 and 2012, which drove mitigation work at St George and a Roma levee often highlighted by the insurance industry.

“They did see an initial reduction, as did we, in premiums, but it’s really been since about 2021 that the premiums have just gone up almost 100% year on year,” Cr O’Toole said. “Some places are seeing 400%.”

Cr O’Toole says surging premiums are affecting homes that have not been inundated in 13 years. Residents who were paying $1500-$2000 a few years ago are now looking at $15,000-$23,000 and more people and businesses may drop insurance.

“These businesses are essential to our communities. I hate to see one of them close shop because they have uninsured themselves, something else happens to their business and they can’t afford to rebuild.”

Cr O’Toole has also called on the federal government to act on flood inquiry recommendations and to consider a flood pool, as other councils watch developments.

“The federal government needs to have an active role in this conversation, which we feel has been really lacking to date. They should really be driving the conversation to achieve affordable insurance for all Australians.”