Why Does Broome Pay Higher Premiums?

We recently wrote an article on why premiums are higher for business insurance and personal insurance when located in WA’s far north.

Mainly it’s due to the inclement weather and a lack of insurers willing to compete in this space.

There are 3 main insurers who look at property risk above the 26th parallel – that is, in the top half of Australia and they apply a one size fits all rating model to all clients who fall into these areas.

While the north west sustains cyclones and flooding which generally lead to more expensive claims than say bushfires affecting properties and towns around Perth, recent claims in Queensland and the east coast as a result of cyclone Debbie are likely to cost around $2 billion – these are all areas that all fall into the 26th parallel. This means that premiums in Broome effectively subsidise in part premiums in the east.

While insurance companies need to remain profitable and pass their costs onto consumers, it doesn’t seem fair that clients in Broome and the northwest of Australia are penalised for higher claims sustained in other areas.

Part of our role as your insurance broker and client advocate is to ensure you’re not disadvantaged. Accordingly, we are continually in negotiations with the insurers to push them to understand the specific risks in Broome and surrounds versus other areas that fall in the 26th parallel. We believe insurers should determine a rating structure that is aligned with the actual risks that each of these areas face not a one size fits all approach. We will continue to do push for these changes.

To know more, get in touch with our team today.

About David White

David has over 35 years of insurance experience, all as an Insurance Broker. Over his career, David has established a reputation for dedicated client focus, attention to detail and innovative insurance placement solutions.

Joining Phoenix in 2015 David brought significant international and local broker management experience to the Phoenix team and was appointed Managing Director in 2018. David is an owner of Phoenix Insurance Broker and provides a unique blend of leadership, insurance and general business skills along with the strong belief in teamwork and family that drives Phoenix forward.

Please contact Phoenix Insurance Brokers Pty Ltd today to discuss your Insurance needs.