Insurance Costs Soaring – and that’s before the summer’s fires

The South Australian Council of Social Service’s latest Cost of Living Update, released today, highlights the importance of insurance costs in household budgets, points to a long term trend of insurance prices rising at well-above the general inflation rate and raises concerns about the implications of un/under-insurance for vulnerable households.

The report found that:

  • Average South Australian households spend $94 a week (and $107 nationally) on all insurances – double the weekly expenditure on energy or telecommunications
  • House and contents insurance (which is most relevant to disaster resilience) accounts for nearly twice the share of household expenditure for those in the lowest income quintiles by comparison with the highest quintile
  • Renters pay far less per week (because they are only insuring contents, not the house itself), but also have massively greater levels of un-insurance with over 60% of renters not having contents insurance
  • Insurance prices since December 2000 have risen by 97% in Adelaide and 121% nationally, compared to a 59% increase in the national CPI. This data predates this summer’s fires, hailstorms and floods which may further increase insurance prices.

SACOSS Senior Policy Officer and report author, Dr Greg Ogle said,

“Insurance is important because of the size of the expenditure in the household budget, but also because it is a key way that the costs of disasters and extreme weather events are socialised throughout the community.”

“In the context of events like this summer’s disastrous fires, insurance provides a sort of privatised safety net – but one that is only available to those only available to those willing and able to pay the premiums. And with prices rising we are concerned that people on low incomes will opt out of insurance, making them doubly vulnerable to disasters.”

“We have already seen some media reports of massive hikes in insurance premiums in some disaster-effected areas, but our Cost of Living report suggests that the costs of the summer disasters will end up impacting on all households, whether they are insurance policy holders or not, and regardless of where they live.”

“After the Christmas-New Year fire disasters, insurance costs and coverage should be at the forefront of cost of living and disaster resilience considerations – not least because climate science predicts that the extreme weather events are likely to grow more frequent and more challenging.”

The SACOSS report calls for:

  • Insurance companies to develop more simple and low cost insurance options for low income households and government to promote existing low-cost basic insurance products such as those being offered by leading NGO, Good Shephard Microfinance
  • The State Government to review stamp duty on insurance premiums to provide short term, targeted relief for low-income earners
  • A national review to examine how those on low incomes can better access insurance
  • Raising the rate of Newstart and similar income support payments by $95 per week, which (amongst other things) will assist those on the lowest incomes to afford insurance.

The SACOSS Cost of Living Update can be downloaded here

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KELLY VINCENT

Kelly is a writer and an advocate living on Kaurna land. At age 20, they won the State Theatre’s Young Guns Award for young playwrights for Gravity. At 21, they became Australia’s youngest Member of Parliament and first-ever appointed specifically on the platform of disability rights. From 2010 to 2018, Kelly represented the Dignity Party in the Upper House of South Australia’s State Parliament, making vital changes to the way service providers, the built environment, and the justice system respond to the needs of disabled people. They are now Creative Director of True Ability, a disabled persons’ theatre company they co-founded in 2020.

CHERYL AXELBY

Cheryl is a proud Narungga Woman, living on Kaurna land, and is passionate about improving the quality of life for her people. Cheryl has extensive experience working with Aboriginal communities, and federal and state government sectors at senior and executive level in a career spanning over 43 years. Currently she is National Co-Chair of Change the Record, Head of Aboriginal Housing – Housing SA and in March 2024 she was elected as the Central Region 1 representative in the historic First Nations Voice to SA Parliament.

DAVE ADAMSON

Dave moved to Australia following a 30-year academic career in the UK. He has since worked in the Community Housing sector and authored the 2016 Towards a National Housing Strategy, and helped to establish the Everybody’s Home campaign. He also researches the interface between poverty and climate change and actively supports the United Nations Sustainable Development Goals. He has worked with government at all levels and has experience of policy development and evaluation. He is co-author of Sustainable Places: Addressing Social Inequality and Environmental Crisis (2022, Routledge). In his spare time he plays and builds guitars.

ROHAN FEEGRADE

Rohan is an experienced and forward-thinking CEO, senior executive and board director with demonstrated expertise across the not-for-profit, private and government sectors. Currently CEO of Lutheran Care, he has proven record for creating substantial organisational, stakeholder and client value, and has extensive experience in strategically positioning organisations for transformational change and growth within the health, disability, education and community service sectors. Rohan is a socially responsible professional, genuinely passionate about creating opportunities for people who live with disadvantage and disability, always acting ethically to serve those he works with and for.

DR JEN CLEARY

Jen is a human geographer, with a background spanning social services and social policy ,vocational and higher education and regional, rural and remote research and development. She is currently the Chief Executive Officer of Centacare Catholic Country SA (CCCSA), a for-purpose organisation providing social services in regional, rural and remote communities in South Australia, across a footprint of some 980,000 square km. She was awarded a PhD in Geography from the University of SA in 2014. She holds an adjunct professorial position with the Centre for Social Impact at Flinders University and is a member of the Advisory Panel for the University of SA Justice and Society Arts Program.

NANCY PENNA

Nancy has than 30 years of experience in South Australian community services, and a a unique understanding of the political and social landscape and the issues and opportunities facing South Australia. Currently responsible for the strategic and operational oversight of AnglicareSA’s community services portfolio, she has previously held executive roles in government within child protection and disability, with her executive experience underpinned by her earlier career as a social worker in child protection and youth justice. She is also Chair of the Child and Family Focus South Australia (CAFFSA) Board and most recently on the Housing Security for Older Women Taskforce.

NICOLE CHAPLIN

Nicole is a dedicated and experienced youth support professional, specialising in solutions for disadvantaged young people in South Australia. As CEO of St John’s Youth Services, she oversees innovative programs like youth110 and Foyer Port Adelaide. With over thirty years in the community sector, Nicole has built extensive networks and her expertise spans governance, service delivery, policy development, and partnerships. Recognised with the 2018 AHI Inspirational Leader Award, Nicole is an active participant in housing and homelessness networks. She holds leadership roles in various organisations, including Anglicare Australia’s National Reconciliation Network.

EMMA CROSBY

Emma is a chartered Accountant with more than 15 years experience as a board member, finance and business professional, strategic advisor and company secretary. She has strong values and a passion for enabling and leading organisations to meet its operational and strategic direction through long-term financial sustainability, operational efficiency, innovation, leadership, transformation and partnerships. As Treasurer and Board member at SACOSS, she is committed to successfully leading and making a purposeful impact to the organisation and its stakeholders.

David PANTER

David has worked in health and social care for almost 45 years, over half of which has been as a Chief Executive. In the UK he initially worked in the NHS and more latterly in local government, where he was Chief Executive of Brighton & Hove City Council. In 2004 David was recruited to the South Australian public health system for over 10 years leading reforms including the development of the new Royal Adelaide Hospital. From 2015-2022 David was the Chief Executive of not-for-profit aged care provider ECH. At the end of January 2022 David became the Chief Executive at Minda, SA’s largest provider of services to people living with an intellectual disability.

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