ICA calls on the government for a resilience fund in the Federal Budget

The Insurance Council of Australia (ICA) is calling on the government to establish an ongoing resilience fund that would assist Australians to recover from the impact of natural disasters. 

The ICA wants the government to commit to a $250 million per year resilience fund as part of the next Federal Budget. This ongoing fund would be used to help buy back and raise homes for those families who have been affected by floods and other natural disasters.  

As noted in its ‘Pre-Budget submission’, the ICA wants the amount of $250 million for the ongoing fund to be matched by the states and territories, bringing the total ongoing resilience fund amount to $500 million. It estimates that this amount will be able to help almost 750 families every year to escape their high-risk environments and restart their lives. 

The proposed $500 million resilience fund is aimed at supplementing pre-existing arrangements and schemes that are already in place in states such as NSW and Qld, established in the aftermath of the devastating 2022 floods.  

So far, the government has already invested $1.6 billion via joint funding arrangements to help buy back homes that are considered to be at-risk. 

The ongoing resilience fund by the ICA would exist over and above the $200 million per year resilience investment provided the government through the Disaster Ready Fund Arrangements (DRFA), an amount which is matched by the respective states and territories.  

Other policy suggestions in the ICA’s Pre-Budget submission aimed at driving down cost-of-living and increase in insurance premiums include: 

• Incentives provided to state governments to remove insurance taxes, helping provide immediate cost-of living relief; 
• Extending the current Disaster Ready Fund (DRF) to make it a long-term, 10-year rolling program; 
• Proposed reforms to land use planning and building codes, protecting Australian homes from long-term risk of extreme weather and;
• Ensuring cheaper vehicle repairs via more training for EV mechanics and lesser barriers for motor trades. 

“While there is no one solution that would immediately work to counter these factors, collectively the measures outlined in our Pre-Budget submission work to relieve upward pressure on premiums by reducing risk, which is the ultimate driver of insurance costs, and so support the community’s need for action on cost of living,” said Andrew Hall, CEO of ICA.