Seclusion apartment complex in Cairns whacked by huge strata insurance bill

Ludicrous insurance premium hikes have left Cairns apartment dwellers with bills that have tripled in the space of three years – and serious fears about what comes next.

LUDICROUS insurance premium hikes have left Cairns apartment owners with bills that have tripled in the space of three years – and serious fears about what comes next.

Seclusion at Freshwater body corporate chairman Ross Dingle received a notice this week saying the unit complex’s bill was increasing to $184,000 for the year.

In 2019 it was about $60,000, then it hit $90,000 in 2020 for an 11-month policy, and last year rose to $137,000.

Strata Unit Underwriters (SUU) is the only provider currently willing to offer insurance for the Kamerunga Rd apartments, so owners have found themselves between a rock and a hard place.

Mr Dingle said he was at wits’ end and desperately hoped Leichhardt MP Warren Entsch’s long awaited $10bn reinsurance pool for cyclone regions would fix the expensive debacle.

“We’ve tried to look overseas with the Lloyd’s of London, but they won’t cover it,” he said.

“We’ve tried to split (the 56 units) up to see if they could do it in eight separate titles, but nothing at all.

“Last year we had to put in for a special levy because we budgeted for $90,000 or so, and then it went up to $137,000.”

QLD_CP_NEWS_INSURANCE_03FEB22

Residents are understandably upset over the hike which will slap each unit owner’s bill with about an extra $1000 cost this year.

“Even this year we budgeted $140,000 and we’re going to be more than $40,000 short again,” he said.

“I’m going to have to go to the owners and tell them they have a month to pay this.”

The complex was built in 2006 and has never endured any cyclone damage apart from a couple of broken water pipes, for which claims of less than $5000 were made.

Such damage would not even be worth asking about now.

“The excess for a normal claim is $1000, but our excess for a cyclone claim is now $56,000,” Mr Dingle said.

Legislation for the federal government’s reinsurance pool is due to be introduced to parliament in the first sitting weeks of this year.

It features a $10bn government-backed cash pool that would take on insurance companies’ risk for cyclone damage.

It is scheduled to come online in July for residential, strata, and small business property insurance policies.

In theory, it should drastically reduce premiums – and insurers will not simply be able to opt out.

Jake Stackman clears debris from Gatton Street in Parramatta Park after a large tree fell across the road in wet and wild weather conditions back in March 2021. Picture: Brendan Radke

The Australian Competition and Consumer Commission (ACCC) will be given $18.4m over five years to monitor policies and ensure savings are passed on to policyholders.

Those that fail will cop significant fines.

Mr Dingle said it could not come soon enough.

“We’ve heard nothing – just that it may be happening this year,” he said.

SUU has been asked for comment.

The Insurance Council of Australia’s 2020-21 Insurance Catastrophe Resilience Report revealed there had been more than $8.9bn in natural disaster claims across Australia since 2018.

“The Victorian and New South Wales governments have also recently increased resilience funding, however Queensland, which faces the most significant threat from cyclone and cyclone-related flood, has unfortunately all but ceased funding this crucial area with the cessation of some innovative home resilience programs,” it said.

Follow @chriscalcino

Originally published as Seclusion apartment complex in Cairns whacked by huge strata insurance bill