The Insurance Council of Australia (ICA), the representative body for the general insurance industry, has called for greater national investment in disaster resilience and risk reduction to ensure the long-term success of the Cyclone Reinsurance Pool (CRP) and deliver sustained insurance affordability for households and businesses across Northern Australia.
The review is the first assessment of the CRP since it was introduced and seeks to measure its impact on insurance affordability and availability in cyclone-exposed regions.
Since its establishment in 2022, the CRP has helped to reduce premiums, with the Australian Reinsurance Pool Corporation (ARPC) reporting savings of up to 39% for the highest-risk properties. Access to insurance has also improved, with insurers accepting more quotes across all risk categories, including a 27% increase in the highest-risk areas, according to ARPC data.
The ICA highlighted that while the CRP is contributing to affordability gains, it does not directly reduce the physical risks associated with cyclones and severe weather. As these events become more intense, ongoing investment in resilience infrastructure, improved building standards, and mitigation initiatives will be essential to safeguard communities and maintain downward pressure on costs.
The Council also noted that flood coverage remains a major affordability concern, with around 1.36 million properties nationwide facing flood risk. The ICA is calling for a coordinated national response that integrates financial incentives, infrastructure upgrades, and community engagement to reduce exposure and enhance long-term resilience.
The ICA continues to advocate for stronger alignment between the CRP and broader mitigation programs, underpinned by shared data and research to refine risk-based pricing and inform effective policy and investment decisions.
Representing the vast majority of general insurers operating in Australia, the Insurance Council works with governments, regulators, and stakeholders to improve community safety, strengthen resilience, and promote accessible, sustainable insurance for all Australians.
ICA Deputy CEO Kylie Macfarlane added: “Insurers are passing on savings from the CRP to policyholders, who are seeing improvements in insurance affordability and availability, particularly in areas facing the highest cyclone risk.
“But more work must be done to better align the CRP with risk mitigation by leveraging data on what works and investing in risk mitigation. Extreme weather continues to intensify, requiring genuine partnership between government and industry to reduce risks and protect communities. Insurers are working with all levels of government on solutions that deliver long-term improvements to community safety and insurance affordability.”
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