FOREIGN insurance companies could soon find their way into the North Queensland market.
The Federal Government yesterday flagged the possibility of greater competition by allowing major Asian insurance companies to set up business in North Queensland, creating a website to compare insurance premiums and making insurance companies use more accurate information on individual properties when writing policies.
Federal Member for Dawson George Christensen said he had been calling for a change to the insurance market for more than two years.
Despite the rising cost of insurance premiums, an investigation last year by the Australian Government Actuary into strata title insurance price rises in North Queensland found insurers in North Queensland were not price gouging.
However the report, In the Wake of Disasters - The Affordability of Strata Title Insurance volume two, stated North Queensland residents had been hit with premium increases of more than 500% in recent years.
"This has been a result of a complex range of contributing factors, none more so than a glaring lack of competition in the market for residential strata title insurance," it stated.
Mr Christensen said when there were only one or two companies offering some types of insurance premiums across North Queensland, the market had failed and the government must intervene.
He said he had received reports of people dropping their home insurance cover because they could no longer afford it.
"In the case of strata title insurance, that is not possible because bodies corporate are compelled by law to take out insurance," he said.
"If the best offer a body corporate can find is ridiculously high, they have to accept it because they have to comply with the law."
Insurance Council of Australia general manager of communications Campbell Fuller said it would consider the government measures and the impact they would have on the insurance industry and community once it had more details.
Update your news preferences and get the latest news delivered to your inbox.