Farm Insurance :: News
SHARE

Share this news item!

Consumer Advocates Criticise Insurers Over 'Poverty Premiums' and 'Loyalty Taxes'

Consumer Advocates Criticise Insurers Over 'Poverty Premiums' and 'Loyalty Taxes'

Consumer Advocates Criticise Insurers Over 'Poverty Premiums' and 'Loyalty Taxes'?w=400

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.

Consumer advocacy groups have voiced strong opposition to the insurance industry's decision to reject recommendations designed to eliminate practices that disadvantage consumers, including charging higher rates for monthly bill payments and increasing renewal premiums for loyal customers.
The Financial Rights Legal Centre has cited ongoing reports from consumers being adversely affected by these pricing practices, which they refer to as a "poverty premium" and a "loyalty tax."

The Insurance Council of Australia (ICA) recently published an action plan in response to 150 recommendations from the parliamentary floods inquiry and a comprehensive review of the industry code of practice. Despite the consensus among both reviews that insurers should not charge more for monthly payments than they do for annual ones, and renewal premiums should not surpass those offered to new customers, the ICA asserts that enforcing pricing policies is not within the code's remit due to competition law restrictions.

Continuous concerns have been raised about the code's enforceability and the numerous recommendations the ICA did not fully endorse. Financial Rights Legal Centre's Drew MacRae stated that around 38 recommendations are still under consideration, or have been delegated to individual companies to decide upon.

Financial Counselling Australia has expressed significant concern that the ICA's action plan does not actively address inequitable pricing practices. According to their disaster recovery co-ordinator, Louise Hayes, it is essential for insurers to address these unfair practices and incorporate them into the industry code to ensure accountability and equity.

While the ICA's action plan includes some positive initiatives, such as a framework for assisting vulnerable customers, it also drew criticism for lacking a firm commitment to enforceability. The recommendations from the inquiry suggested these policies should be embedded contractually within product disclosure statements to strengthen consumer protection.

Stephanie Tonkin, CEO of Consumer Action Law Centre, highlights the importance of rebuilding consumer trust, especially following the response to the 2022 floods. She stresses that the industry's focus should shift more towards customer welfare rather than profitability, with enforceable actions driving this change.

ICA CEO Andrew Hall noted that the action plan aims to guide industry changes over the coming years with a central focus on enhancing the customer experience. He acknowledged the necessity of collaborating with consumer advocates, regulators, and the government to tackle the underlying issues cited in the reviews.

Published:Wednesday, 26th Mar 2025
Source: Paige Estritori

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

Share this news item:

Insurance News

Steadfast Unveils Prevail: A New Era in High Net Worth and Farm Insurance
Steadfast Unveils Prevail: A New Era in High Net Worth and Farm Insurance
17 Jan 2026: Paige Estritori
In a significant development for the Australian insurance landscape, Steadfast has announced the launch of Prevail, a new specialist agency designed to cater to high net worth individuals and the farming sector. This initiative brings together three well-established underwriting agencies-Mansions, Dawes, and Argis-under a unified brand, aiming to provide comprehensive and tailored insurance solutions. - read more
Harland Green Launches Comprehensive All-Risk Insurance for Large-Scale Farms
Harland Green Launches Comprehensive All-Risk Insurance for Large-Scale Farms
17 Jan 2026: Paige Estritori
Harland Green, a newly established Lloyd's coverholder, has introduced an all-risk farm insurance package specifically designed for large commercial farming operations in Australia. This initiative aims to address the complex and evolving needs of the agricultural sector by offering comprehensive coverage that encompasses various aspects of farm operations. - read more
Allstate Underwriting and Mitsui Sumitomo Join Forces to Strengthen Farm Insurance Offerings
Allstate Underwriting and Mitsui Sumitomo Join Forces to Strengthen Farm Insurance Offerings
17 Jan 2026: Paige Estritori
Allstate Underwriting Agencies has announced a strategic partnership with Mitsui Sumitomo Insurance (MSI) to enhance its capacity in providing insurance solutions for medium, small, and hobby farms across Australia. This collaboration is set to bolster Allstate's presence in the farm pack market, offering tailored products that meet the specific needs of these farming segments. - read more
Rural Affinity and Munich Re Strengthen Agricultural Insurance in Australia
Rural Affinity and Munich Re Strengthen Agricultural Insurance in Australia
09 Jan 2026: Paige Estritori
In a significant development for Australia's agricultural sector, Rural Affinity has renewed its partnership with Munich Re Specialty - Global Markets under a new five-year agreement. This collaboration, which began in 2006, is set to enhance the availability and scope of agricultural insurance products across the country. - read more
WFI Insurance Highlights Significant Drop in Farm Liability Claims
WFI Insurance Highlights Significant Drop in Farm Liability Claims
09 Jan 2026: Paige Estritori
WFI Insurance has reported a notable decrease in farm liability claims across most categories, signaling a positive trend in safety practices within the Australian agricultural sector. The insurer observed a 75% reduction in falls from height over the past year, alongside a 30% decline in impact injuries, marking the lowest level in four years. - read more
Elders Insurance Highlights Increased Summer Storm Risks for Farmers
Elders Insurance Highlights Increased Summer Storm Risks for Farmers
09 Jan 2026: Paige Estritori
Elders Insurance is urging Australian farmers to prepare for another damaging summer, with claims data revealing the scale and financial impact of storm activity across the country's agricultural regions. Analysis of storm-related farm insurance property claims over the last two years indicates that summer accounts for the highest number of claims nationally. - read more



Farm Insurance Articles

Essential Coverage vs. Optional Add-ons: Balancing Protection and Costs
Essential Coverage vs. Optional Add-ons: Balancing Protection and Costs
For Australian farmers, having the right insurance coverage isn't just a safety net—it's an integral part of sustaining their livelihood. Natural disasters, unpredictable climate conditions, and the inherent risks of agricultural production underline the critical importance of robust insurance for the agricultural community. As farmers navigate the complexities of insurance, understanding the basics becomes the first step toward securing their assets and ensuring the continuity of their operations. - read more
How to Choose the Right Farm Insurance Policy for Your Needs
How to Choose the Right Farm Insurance Policy for Your Needs
Farm insurance is a type of coverage designed specifically for the unique risks and operations involved in farming. It encompasses protection for farm dwellings, equipment, livestock, and crops, offering a tailored approach that reflects the diverse needs of farm owners. This coverage can help safeguard your livelihood against unforeseen events that could disrupt farm operations or result in significant financial losses. - read more
Is Your Farm Under-Insured? Tips for Assessing Bushfire Insurance Adequacy
Is Your Farm Under-Insured? Tips for Assessing Bushfire Insurance Adequacy
The threat of bushfires looms large over the vast expanses of rural Australia, shaping the reality of farming in this sunbaked landscape. The risk, always present, escalates as the climate warms and dry conditions persist. It's not a matter of if, but when the land will be tested by fire's wrath. In this environment, the armor of insurance isn't just recommended; it's critical for survival. - read more
What You Need to Know About Crop Insurance for Your Farm
What You Need to Know About Crop Insurance for Your Farm
Farming is a risky business. As a farmer, you are at the mercy of the weather, pests, and other challenges that can threaten your crops and your livelihood. That’s where crop insurance comes in. Crop insurance can provide financial protection in case your crops are damaged or destroyed, allowing you to recover from losses and move forward with your farm business. - read more
Top 10 Ways Australian Farmers Can Slash Insurance Costs Without Risking Coverage
Top 10 Ways Australian Farmers Can Slash Insurance Costs Without Risking Coverage
Welcome to our definitive guide for Australian farmers on managing one of the most crucial aspects of their business: insurance. As a cultivator of the land, you're no stranger to the unpredictability of nature and the market. From intense weather events to fluctuating market demands, your line of work comes with its unique set of risks. Hence, safeguarding your livelihood with the right insurance is not just important—it's essential. - read more
Secure Your Farm's Future: Understanding the Importance of On-Farm Risk Assessment
Secure Your Farm's Future: Understanding the Importance of On-Farm Risk Assessment
In the ever-evolving landscape of modern agriculture, the security and stability of a farm hinge on thorough preparation and strategic foresight. A pivotal component in safeguarding a farm's future lies in the critical role of on-farm risk assessment. This process provides a structured approach to identifying potential risks that could affect a farm's operations, financial health, and overall sustainability. - read more

Need a Quote?
Start your free farm insurance quote comparison here.
Farm Type:
Postcode:

All quotes are provided free and without obligation by a Specialist from our National Broker referral panel. See our Privacy Statement for more details.


Knowledgebase
Public Liability Insurance:
Insurance which provides protection against liability to third parties.