Yahoo Finance Aussies forgoing home insurance as premiums skyrocket by 72%
Australians are increasingly forgoing home and flood insurance as concerns grow over the rising cost of living, new research has revealed.
The nationally representative survey, conducted by CHOICE in June 2022, found two in three Australians were concerned about home insurance prices following the devastating floods earlier this year.
The findings marked the second quarter in a row in which record numbers of people voiced their worry over the cost of insuring their home.
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"Almost two in three people have expressed concern about the cost of home insurance, with 28 per cent of people very concerned about the cost," said CHOICE insurance campaigner Dean Price.
"With devastating floods in recent memory, affordable access to home insurance is front of mind for many consumers."
Home insurance prices rise 72% in 5 years
CHOICE’s analysis of Finity data also found the cost of home insurance quotes had significantly increased over the past five years, by up to 101 per cent in some cases.
"Home insurance premium quotes have increased by 72 per cent over the past five years across the country," Price said.
"West Australians have faced the biggest hikes, with the average quote up by 101 per cent over the same period."
The average home insurance quote in Queensland currently stands at $3,853 for a year of cover, which is far too high for many Aussies who are feeling the pinch of the rising cost of living.
Aussies ditch flood cover amid rising costs
Price said many Australians were being forced to go without flood insurance, "leaving themselves vulnerable".
"Some people are forgoing flood insurance if they can't afford it, while others have little choice but to leave their property under-insured or uninsured," he said.
With extreme weather events expected to increase in frequency and devastation across Australia, Price predicted it was going to be more challenging for people to access affordable and appropriate insurance.
"The new Federal Government has an opportunity to investigate solutions to help people doing it tough across the nation," he said.
'The true cost of climate change'
As part of its research, CHOICE spoke to a number of Australians who cited concerns about the rising costs of home insurance, including Bruce Robertson, who owns a flood-prone property in the mid-north coast region of NSW.
Robertson revealed that he once paid around $2,000 a year on his home insurance premium - with flood cover included - but two years ago, the price went up to $18,000 per year overnight.
As a result, he was forced to drop the flood cover, leaving his home uninsured in the event of a flood.
"I'm really unhappy about it, it doesn’t give me a good feeling not being insured, you do feel uneasy and you do feel exposed," Robertson said.
"It's a big asset, if you lose that it would have a huge impact on our lives and our kids' lives.
"If the house got flooded, people would say that's really irresponsible being uninsured for flood. But what choice do you have?
"You have to drop the cover and run the risk. This is the true cost of climate change, this is it in action."
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