Revealed: Insurance premiums killing off Gold Coast clubs with flood-prone council grounds
Sporting and community groups are being financially crippled by massive insurance premiums – here’s what’s happening.
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SPORTING and community groups are being financially crippled by being forced to pay massive insurance on multimillion-dollar facilities situated on flood-prone council land.
A perfect storm of horror weather events in the middle of a pandemic is compelling Gold Coast associations to seek help, but council fears setting a legal precedent by paying their insurance premiums.
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The Bulletin understands the council has rejected a request from the Gold Coast Hockey Management Group (GCHMG) which has managed the lease for Keith Hunt Park at Labrador after it underwent a $16 million makeover for the 2018 Commonwealth Games.
A major storm event in January 2020 saw 350mm of rain dumped on the site in a few hours, creating “significant damage and a subsequent insurance claim lodged by GCHMG”.
A council report reveals a community grant was approved to meet a payment shortfall.
The amount of the grant, along with the cost of rising new insurance premiums are hidden in the redacted report considered by councillors in a closed session.
Council officers in the report acknowledge the Labrador facility is hosting international and state teams and “continues to be an economic driver for the city”.
“This national standard facility is managed on the city’s behalf by a not-for-profit lessee — the GCHMG — and insurance premiums place significant pressure on the ability to remain financially viable, particularly in the current climate influenced by COVID-19,” the report says.
But councillors backed the recommendations by officers to refuse a request to remove the hockey group’s obligation to insure the buildings under its lease.
Other clubs had similar leases and premiums and “permitting such a request for one party may set a precedent”.
Hinterland-based councillor Glenn Tozer said at least three groups — the Hinterland Community Band at the Mudgeeraba Music Centre, the Mudgeeraba Show Society at the Showgrounds, and Firth Park Sporting Groups — were in a similar position in his area.
Councillors are waiting on a report on the city’s leasing policy which will consider insurance premiums and the overall impact of flooded fields.
Touch football associations like Southport’s Owen Park are loath to use grounds during downpours because they must fund repairs if they play after council cautions against use.
Cr Tozer said: “Many of our sporting fields have a dual use as drainage reserves.
“All of the relevant risks, including water damage risks, need to be considered when we review the leasing policy, and community groups consider budgeting for their tenure in public buildings.”
The Hinterland Community Band (HCB) had recently contacted Cr Tozer about their insurance premiums and trying to find ways to reduce their obligations.
“Many groups like HCB run on a shoestring budget and we’re doing our best to devise a system that is fair and equitable to groups and to the broader ratepayer,” he said.
“Every group I’ve talked to in Division 9 is seeking ways to reduce their costs while improving their level of service to their members.
“The increasing cost of insurance is definitely a concern for many of these groups. While I don’t believe any group will fold as a result of premiums, prudent governance requires we at least ensure the best possible outcome in the community interest.”
Cr Tozer encouraged community groups to contact their divisional councillor about potential options to reduce insurance premiums.
“Many community groups run on amazing volunteers who are able to work together to fundraise or undertake maintenance, reducing the reliance on insurance, via a higher “excess”, for example,” he said.
While council has refused the request from GCHMG, officers and volunteers are meeting to work on support including grants.
●If you are a non-for-profit group or a sporting association facing leasing and insurance problems, tell us you story by emailing paul.weston@news.com.au.
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