Coalition Pledges to Cut Insurance Capital and Compliance Costs

The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.

The ICA has expressed approval, acknowledging the importance of regulation in protecting consumers and building trust in the industry. However, it highlighted the strain that rapid regulatory reforms over the last ten years have placed on resources, which in turn increases costs for customers. The proposed adjustments to capital liquidity rules could enhance productivity and cut consumer expenses, which insurers have long advocated for.

According to Angus Taylor, the financial services sector faces compliance costs exceeding $1 billion, with Australians remaining underinsured and underadvised. Taylor emphasised the need for a balance in APRA's (Australian Prudential Regulation Authority) capital rules to ensure stability while improving access to finance for households and businesses. The goal is to reflect risk more accurately in insurer portfolios, reducing consumer costs and unlocking capital for investment, all while maintaining financial stability.

Expert insights from Scott Duncan, a Taylor Fry actuary, highlight challenges such as natural disaster impacts and building material cost inflation on home insurance. Duncan suggests that while capital requirements are essential, they become secondary to these factors. Current prudential standards ensure insurers hold sufficient capital against rare catastrophic events, allowing for potential higher-risk investments.

As regulatory frameworks assess the alignment of assets and liabilities, the asset risk charge mechanism remains vital. The experience of recent catastrophic events underscores the rapid changes in liabilities and the significant impact they can have, reinforcing the need for adaptable regulatory approaches.

Published:Wednesday, 26th Feb 2025
Author: Paige Estritori

Please Note: If this information affects you, seek advice from a licensed professional.

Share this news item:

Insurance News

Clear

AUSactive's New Insurance Offering: Enhanced Protection at Lower Costs

26 Mar 2026: Paige Estritori

AUSactive, Australia's leading body for the exercise and active health sector, has unveiled a new insurance solution designed specifically for fitness and active health professionals. This initiative aims to provide enhanced protection while offering lower premiums compared to existing market options. - read more

Private Health Insurers Advocate for Reforms Amid Rising Specialist Fees

26 Mar 2026: Paige Estritori

Private health insurers in Australia are raising concerns over the increasing fees charged by medical specialists, which are leading to higher out-of-pocket expenses for patients and causing some to delay or cancel necessary care. A recent report by Private Healthcare Australia highlights that more than half of the surveyed patients received medical bills larger than expected, with specialist fees for in-hospital care rising by 22% over the past three years. - read more

AMA Calls for Urgent Reforms in Private Health Insurance Sector

26 Mar 2026: Paige Estritori

The Australian Medical Association (AMA) has released its annual Private Health Insurance Report Card, revealing that Australians are paying more for private health insurance while receiving less value. The report indicates that premiums have risen sharply, outpacing inflation and wage growth, with nearly 70% of policies now containing exclusions that limit coverage. - read more

Australians Uphold Insurance Commitments Amid Economic Challenges

26 Mar 2026: Paige Estritori

In the face of escalating cost-of-living pressures, Australian households are demonstrating a steadfast commitment to maintaining their insurance coverage. Recent research conducted by national insurance provider Youi reveals that despite financial strains, a significant portion of Australians continue to prioritise insurance as an essential component of their financial planning. - read more

Significant Health Insurance Premium Hikes Loom for Australians

26 Mar 2026: Paige Estritori

Australian health insurance policyholders are facing the most substantial premium increases since 2017, with recent approvals setting the stage for significant financial impacts on households. The federal health minister has sanctioned a notable fee hike, prompting concerns about affordability and the potential for consumers to downgrade their coverage. - read more

Record Profits for Australian Insurers Amidst Premium Increases

26 Mar 2026: Paige Estritori

Australia's insurance industry has reported an after-tax profit of $6.1 billion for the year 2024, a figure that is three times higher than the five-year average of $2 billion. This substantial increase in profitability coincides with significant hikes in insurance premiums across various sectors. - read more

Understanding the Impact of NSW's Landmark Court Decision on Construction Liability

26 Mar 2026: Paige Estritori

In January 2026, a pivotal ruling by the New South Wales Court of Appeal in the Pafburn case has significantly altered the landscape of construction liability, with profound implications for builders and developers across the state. This decision, coupled with amendments to the Design and Building Practitioners Act 2020 (DBP Act), necessitates a thorough reassessment of risk management and insurance strategies within the construction industry. - read more

Competitive Pressures Lead to Lower Construction Insurance Premiums in Australia

26 Mar 2026: Paige Estritori

In 2025, Australia's construction insurance market experienced a significant shift, with premiums decreasing across various lines due to intensified competition among insurers. This development marks a departure from the upward trend observed in previous years, offering a more favourable environment for builders and developers seeking coverage. - read more

The Growing Challenge of Underinsurance Amid Rising Home Insurance Costs in Australia

26 Mar 2026: Paige Estritori

Australian homeowners are facing a growing challenge as rising home insurance premiums contribute to a widening protection gap. This trend is leading to an increasing number of households being underinsured or entirely without insurance, exposing them to significant financial risks in the event of disasters or property damage. - read more

Significant Decline in Australian Commercial Insurance Rates

25 Mar 2026: Paige Estritori

In the final quarter of 2025, Australian commercial insurance rates experienced a substantial decline of 12%, marking the most significant drop among the eight regions monitored by Marsh Risk's Global Insurance Market Index. This trend reflects a broader pattern of decreasing rates that began in early 2024, with the Pacific region, predominantly Australia, leading the way. - read more

Click for more Insurance News