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Research shows huge premium increases are on the way and those in northern Australia are already paying well above average.
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Insurance hikes could cripple households and small business
06 January 2023
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7 minute read
Millions of households face increases of $1,000 or more in the cost of home insurance that will put it beyond the reach of many, according to research by online comparison site Finder.
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Almost two-thirds of home and contents insurance customers — 7.4 million people — say their premiums have gone up in the past 12 months and sticking with one company brings few benefits, Finder said.
Insurance expert at Finder James Martin said there was no advantage to staying loyal.
“The best deals are typically offered to new customers when they sign up online,” he said. “Insurers often offer discounts of up to 30 per cent for new customers, so it absolutely pays to shop around each year.
“You can also call your insurer and ask them to price-match or give you the best possible deal. It doesn’t always work, but it’s worth a shot — they’ll often do what they can to keep your business.”
Finder’s data shows 60 per cent of households — 11.8 million — protect themselves some form of insurance but despite rising costs only 11 per cent have switched brands in the past six months.
The research also found 14 per cent of customers were unaware if their premiums had gone up while only 22 per cent had avoided a cost increase.
Mr Martin said it was now more crucial than ever to choose an insurer that offered the best deal.
The first insurance monitoring report by the ACCC found insurance affordability was a significant issue for those living in northern Australia.
The report found that policyholders in those regions faced much higher premiums on average and they had increased more quickly than for the rest of the country.
The report revealed that in 2021–22:
- The average premium for residential combined building and contents insurance in northern Australia was $2,370 — more than $1,000 higher than the Australian average.
- The average premium for strata insurance in northern Australia was $5,740, almost double that of the rest of Australia.
- The average premium for small business building and contents insurance in northern Australia was $3,160 compared with $1,610 in the rest of Australia.
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