Brokers have welcomed the Tasmanian government’s decision to work alongside insurers and intermediaries on affordability, “rather than displacing them”.

In a retreat from an election promise to establish a state-owned insurer, Premier Jeremy Rockliff said last week that Tasmania now plans to “partner with insurers, brokers, reinsurers” to fix insurance affordability and availability gaps.

A new non-profit statutory authority will have a “broad mandate to oversee and support the insurance ecosystem in Tasmania”.

Mr Rockliff said: “Yes, there is a change from state-owned company to state-owned statutory authority.

“I own that change because it’s less expensive and less risk for the Tasmanian taxpayer but delivers on cheaper and fairer insurance.”

The National Insurance Brokers Association says it appreciates “the constructive engagement with insurers, brokers and reinsurers in shaping its response ... NIBA supports practical, evidence-based initiatives to ensure Tasmanians can access the protection they need.”

The statutory authority will have three divisions – consumer, market and risk assessment/mitigation – and offer “advisory, transparency and comparison” functions.

The revised plan, which insurers have also applauded, comes after an assessment of insurance in Tasmania by industry consultant John Trowbridge.

He says Australia and Tasmania are served by a well-developed and resourced insurance sector and it “would be folly not to take full advantage” of that.

Mr Trowbridge says there are “interventions that the government can make to upgrade the competitiveness, affordability and availability of insurance in Tasmania without compromising the state’s financial position”.

He calls for risk management and mitigation activity, saying the “ideal way to reduce insurance premiums is to reduce the costs of claims”.

Among his recommendations are a risk pool for tourism, outdoor recreation, live entertainment and hospitality operators and community associations, and a reinsurance pool all insurers would use for Tasmanian weather events.

This would “insulate them from contributing to the funding of weather events in other parts of Australia”.

“The purpose of this pool would be to protect Tasmanian property owners from losses arising from major weather events (principally bushfires and floods), in substitution for current insurer protections,” Mr Trowbridge says in his report, warning it needs to be “designed with great care”.

NIBA, insurers and Mr Trowbridge all urge Tasmania to prioritise risk reduction and scrap insurance taxes and levies.

See Mr Trowbridge’s full assessment here.