Business NSW Calls for Urgent Insurance Reform Amid Soaring Premiums

The peak business body for New South Wales, Business NSW, has issued a strong call for insurance reform as soaring premiums place financial pressure on businesses across the state.  

Findings from Business NSW’s latest Business Conditions Survey reveal that nearly 80% of businesses have faced double-digit increases in insurance costs over the past year, with one in three experiencing hikes of 30% or more—far outpacing the 2.5% annual inflation rate. 

According to Business NSW CEO Daniel Hunter, insurance affordability has been a top concern for businesses for nearly two years, exacerbated by state and federal taxation policies. The Emergency Services Levy (ESL) and stamp duty in NSW are two important factors that are contributing to high premiums. Hunter warns that many businesses are now uninsurable or simply unable to afford coverage, putting them at significant financial risk in the face of natural disasters and other unforeseen events. 

The survey also found that 64% of NSW businesses are not fully insured against catastrophic events, underscoring the urgent need for policy changes. Business NSW is advocating for a comprehensive review of insurance taxation and regulatory settings to ensure businesses can access affordable and adequate coverage. 

NIBA’s Pre-Budget Recommendations

NIBA, in its 2025/26 pre-budget submission, has proposed three key measures to tackle the challenge of insurance accessibility and affordability. These recommendations are: 

1. Expanding the Disaster Ready Fund (DRF): NIBA recommends extending the DRF into a rolling ten-year program to provide certainty and long-term funding for disaster mitigation projects. This expansion would allow for proactive investment in high-risk areas, reducing the overall impact of natural disasters and limiting premium increases. 
2. Introducing a National Household Mitigation Scheme: NIBA calls for a co-funded initiative between federal and state governments to support homeowners and small businesses in implementing property-level resilience measures. Retrofitting homes and commercial buildings against cyclones, bushfires, and floods could significantly reduce damage costs and insurance claims. 
3. Establishing an Advisory Committee on Emerging Risks: Given the increasing complexity of risk exposure—including cyber threats, artificial intelligence, and geopolitical instability—NIBA recommends the formation of a government-backed advisory body to assess and mitigate emerging risks. This committee would ensure that businesses have the necessary tools and guidance to navigate an evolving insurance landscape. 

The Need for a Long-Term Approach 

Together these measures represent a critical investment in Australia’s future, helping to strengthen household and community resilience, improve insurance affordability and ensure communities and businesses can thrive in the face of growing challenges. NIBA welcomes the opportunity to work with the government to achieve these critical reforms and create a more resilient future for all Australians.