Insurance industry must innovate and adapt following Tropical Cyclone Jasper, Suncorp CEO Steve Johnston says

Ways to reduce the risk extreme weather events pose to Far North Queenslanders must be found as homeowners pick up the pieces following a disastrous wet season, a major insurance group says.

Suncorp Group chief executive Steve Johnston has met with Far North leaders this week as the region rebuilds following Tropical Cyclone Jasper. Picture: Brendan Radke

Ways to reduce the risk extreme weather events pose to Far North Queenslanders must be found as homeowners pick up the pieces following a disastrous wet season, a major insurance group says.

Almost six months on from Tropical Cyclone Jasper and subsequent flooding, Suncorp has processed more than half of the 2600 claims made with the dual disasters expected to cost around $100m in payouts.

But Suncorp CEO Steve Johnston said a key learning from the recent parliamentary inquiry into insurers’ responses to major flood claims in 2022 showed investment in disaster prevention must significantly increase.

Steve Johnston says the insurance sector must adapt and make it easier for homeowners to protect their households from natural disasters. Picture: Brendan Radke

“For every dollar that’s spent on disasters broadly speaking, 97 cents goes to mopping up and three cents is spent on mitigation,” Mr Johnston said.

“It’s a complete imbalance. We should be looking at incentives that allow people to improve the quality of their own home.

“It’s unusual that you can get a subsidy for a solar panel on your roof but you can’t get a subsidy in North Queensland to batten down your roof against a category four cyclone.”

“Pinch points” had emerged following the cyclone, with low rental vacancy rates leaving many customers in disaster-affected communities struggling to find a place to live, Mr Johnston said.

“Temporary accommodation is a very big pinch point,” Mr Johnston said.

The Barron River in Cairns, Far North Queensland, reached a record flood peak, with roads closed and homes flooded in the catchment area on Sunday, December 17. Flood waters lap at the Kamerunga bridge on the Western Road, and despite the bridge remaining open, road access was cut to the northern beaches of Cairns. The record flooding has been caused by ex Tropical Cyclone Jasper, which made landfall on December 13. Picture: Brendan Radke

“There are pinch points around plasterers, painters. There will be pinch points around tilers.

“Rental vacancies are at their lowest point ever, there’s a lot of inflation in rental costs. Some landlords – not all – have taken the opportunity to profit from these events by lifting the costs of rentals.”

Caravans and mobile granny flats will likely be used increasingly in years to come to counter the region’s housing crisis.

“We’ve deployed mobile granny flats across the east coast of Australia. It’s not a great solution but it allows people to stay on their property and supervise the recovery,” Mr Johnston said.

“But if you’re a husband and wife with two kids at school and you’re sitting in a caravan sitting behind your home (after 12 months) waiting for your claim to progress, it’s pretty distressing.

“They are last gasp solutions.”

During his brief visit to the Far North, Mr Johnston met with Cairns mayor Amy Eden and

Member for Leichhardt Warren Entsch.

Mr Entsch said he was working with around two dozen claimants with Sure Insurance who had experienced difficulties with the insurance provider.

“Quite a number of those are now in the process of being resolved,” he said.

“But I think they had so many claimants and they’re a relatively new company. Their back-of-house procedures need to be refined and I believe they are doing that.”

The sector also needed to identify new ways to better protect homeowners, Mr Johnston said.

“Insurers have to modernise,” he said.

“Create new products that allow people to get an appropriate level of cover, even if they can’t get the bells and whistles.”

Originally published as Insurance industry must innovate and adapt following Tropical Cyclone Jasper, Suncorp CEO Steve Johnston says