Premier Jeremy Rockliff promises cheaper premiums, critics warn of taxpayer risk

Cheaper premiums offered by a state-owned insurance company would drive down the costs of living including grocery prices, Premier Jeremy Rockliff says.

Premier Jeremy Rockliff speaks to the media at Rosetta IGA on Thursday, July 3, 2025.

Cheaper premiums offered by a state-owned insurance company would drive down the costs of living including grocery prices, Premier Jeremy Rockliff says.

The Premier announced Liberal party plans for a government-owned insurer on Wednesday, to be leveraged off the existing Motor Accidents Insurance board.

Mr Rockliff said the state “could not afford not to intervene in a failed national market”.

“TasInsure will support mums and dads, households, community groups and small business particularly.

Premier Jeremy Rockliff speaks to the media at the IGA supermarket in Rosetta on Thursday 3 July, 2025.

“Our insurance premiums in Tasmania have driven risen, on average, around 35 per cent in Tasmania over the last few years,” he said. “This is a commitment and a policy for the times.

“No one can deny there is national market failure when it comes to our insurance system.

“In Australia, $6bn of profit, but insurance premiums have increased on average in Tasmania some 35 per cent in a very short amount of time.

“That is not sustainable and governments need to be flexible and they need to listen and they need to act on people’s concerns.”

Mr Rockliff said he was yet to discuss the idea with Treasury.

“I actually will seek advice from many quarters, including Treasury, as we implement this commitment,” he said.

Mr Rockliff appeared at Montrose IGA with owner Chester Wilcock, who said a government-run insurer would be an option he would consider.

“It won’t necessarily affect pricing directly,” he said, but added cheaper premiums would allow him to invest more into the business.

The Insurance Council of Australia said the plan would put “significant financial risk onto the public balance sheet while failing to do anything about the underlying causes of insurance pricing”.

Premier Jeremy Rockliff announces his government would create a government owned insurance business, TasInsure if re-elected. Picture: Elise Kaine

ICA General Manager Public Affairs, Mathew Jones, said: “This proposal poses significant financial risk to Tasmanian taxpayers.

“Overseas examples show that taking risk on to the public balance sheet is a bad idea, particularly when that risk is expected to grow as a result of climate change.

“To address the issues underlying insurance pricing government and industry must work together.

“The insurance industry is committed to progressing this issue in good faith with the next Tasmanian Government.”

RACT CEO Mark Mugnaioni said Tasmania already had a 220,000 member local insurer not driven by profits, mainland interests or returns to shareholders.

“RACT wants to bring down the cost of insurance.,” he said.

“That means addressing the underlying factors driving insurance costs, including more frequent natural disasters, increasing building and construction costs and government fees and charges.

“Our premiums are set to cover our claims, which are increasing in costs and complexity.

“Despite cost pressures, over the past 12 months, RACT’s home insurance costs have increased less than mainland insurers.”

RACT Road Safety campaign installation. 6060 people have died on Tasmanian roads in the last 100 years. The yellow ribbons signify those who have been seriously injured and the white ribbons, those who have died in the last year. RACT CEO, Mark Mugnaioni. Picture: Linda Higginson

He cautioned against “simplistic solutions to complex challenges”.

“MAIB is not a magic pudding and it is not sustainable to use public money to subsidise insurance risks while failing to address the underlying issues that drive insurance costs.

“The solutions require government, experts and the broader community working together.

Mr Mugnaioni said the frequency and severity of extreme weather events are expected to increase by more than 40 per cent statewide by 2050.

Shadow Treasurer Josh Willie said the government was the last organisation that should be going into other insurance business.

“Tasmania has already seen the consequences of serious stuff-ups with state-owned companies, with the Spirit of Tasmania fiasco costing taxpayers more than $500 million,” he said,

Mr Willie questioned the business case behind the proposal and questioned how much it would cost to set up, to run and what effect it would have on the MAIB and car registration costs.

“Tasmanians don’t trust Jeremy Rockliff to run government businesses after his massive stuff up with the Spirits,” he said.

Originally published as Premier Jeremy Rockliff promises cheaper premiums, critics warn of taxpayer risk