An increasing number of Australian postcodes are now considered to be un-insurable, as regional communities across the country face a massive jump in insurance premiums. In a cost-of-living crisis, many home-owners are already making the tough choice to leave their properties uncovered. With experts claiming as many as one-in-ten Australian homes may be un-insured within the next decade.
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00:00Michael Davies loves living in Upper Brookfield, in the hills west of Brisbane, but two years
00:08ago he watched on nervously as heavy rain caused rampant flooding across his suburb.
00:14His house was safe, perched on a ridge well above the floodwater, but despite not making
00:20a claim, his insurance premium tripled to almost $9,000.
00:25It's pretty scary and on the verge of chaos, isn't it?
00:28A carpet cleaner by trade, many of his clients face similar problems.
00:33They're sort of forced to make decisions that probably goes against what they really want,
00:36which leads them to be under-insured and then that creates all sorts of stress in the family,
00:40doesn't it?
00:41It's something being felt across the country.
00:44There are 13 flood-affected communities in the eastern states already considered to be
00:49uninsurable, while a further 15 locations are considered a high risk of becoming uninsurable.
00:55We're seeing flood cover where insurance premiums are $10,000, $20,000, even $30,000.
01:01But it's not just floods.
01:03When the Grampians bushfire threatened Hall's Gap last month, a Sitmameshi evacuated, closing
01:09the doors of his hotel, knowing if it burnt down, he wasn't covered by his $55,000 policy.
01:15I've got no insurance for fire, no flood insurance, so it's really, really basic cover for us.
01:21It's only a small, we're only a little country pub.
01:23Community lawyer Dennis Nelthorpe says in a cost-of-living crisis, many regional residents
01:28simply can't afford insurance.
01:30There are deep-seated problems within the Australian insurance market and the industry
01:38is opposed to government intervention.
01:42Australia's household insurance system is based around individuals negotiating cover
01:46with insurance companies.
01:48Experts say this leads to a power imbalance and high premiums.
01:52They've called on the government to intervene.
01:55There really needs to be essentially a national plan of what we're going to do about these
02:00properties because this is not a small number.
02:02This is one in ten properties.
02:03Michael Davies faces some tough decisions this year.
02:07So we'll probably drop the flood cover in our situation.
02:11Unfortunately I think that's what the problem is, people are going to be forced to sort
02:14of deal with the consequences.
02:16Rolling the dice whenever it rains.