Newsroom

November 27, 2025

KAP Federal Member for Kennedy Bob Katter, has slammed the insurance industry and called for urgent legislative intervention, following alarming concerns raised by Hinchinbrook Shire Council, residents and businesses who are being priced out of basic, essential insurance cover.

Mr Katter said the situation has become “nothing short of economic vandalism” as households and small businesses across the Herbert River floodplain face skyrocketing premiums driven almost entirely by mandatory flood cover, they cannot opt out of.

“These insurance giants are treating the people of Hinchinbrook like a cash cow. They’re slugging families thousands more each year, while giving them no choice and no transparency. It’s a racket – and it’s pushing people into danger,” Mr Katter said.

Mayor Raymond Jayo said Hinchinbrook Shire Council has highlighted that residents are already being forced into three unacceptable outcomes:

1. Going completely uninsured. Leaving families exposed to not only flood impacts, but also cyclones, fire, and storms.
2. Undervaluing their homes and businesses just to achieve an affordable premium, meaning they can never recover properly after disaster.
3. A growing culture of asset neglect, driven by a false belief that “insurance will cover it anyway”, a misunderstanding that insurers themselves have helped create by pushing up claims and premiums.

Mr Katter said the cost of insurance had become so obscene that people were being pushed toward the worst possible outcome: no insurance at all.

“When people can’t insure, the risk doesn’t disappear. It shifts straight onto the public purse,” he said. “Every time a private structure fails and there’s no insurer to foot the bill, council and taxpayers are left to pick up the tab. The whole community suffers,” Mr Katter.

Hinchinbrook’s flood history is well known, yet residents have managed their risks for more than a century. Mandatory flood cover only appeared around 2010; and while premiums have exploded, Mr Katter says the risk profile of the region has not changed.

Mr Katter is calling for two urgent reforms;

First, give property owners the right to opt in or opt out of flood cover which would dramatically reduce premiums while ensuring families can still afford cover for cyclones, fire, storm, and other essential perils.

“Some insurance is always better than no insurance. Right now, the government and insurers are forcing people into no insurance at all. It’s madness.”  Mr Katter states.

Secondly, Mr Katter is also demanding forced transparency in how premiums are released and that insurers disclose; the cost of each risk component (flood, fire, storm, cyclone, etc.), how mitigation measures are assessed and why premiums continue to rise despite reduced claim events in some regions.

“People deserve to know what they’re paying for. Right now, all they get is a bill that goes up every year without justification. It’s disgraceful.” Mr Katter states.

Mr Katter said the insurance crisis in Northern Australia has reached breaking point, and Hinchinbrook is a prime example of a community being punished by corporate greed and government inaction.

“If we want strong, resilient, liveable northern communities, then governments must stop turning a blind eye while insurers bleed the North dry. The people of Hinchinbrook aren’t asking for handouts. They’re asking for fairness and the basic right to insure their homes without being bankrupted," Mr Katter asserted.

Mr Katter said he will be writing to federal ministers immediately and will pursue parliamentary intervention to ensure North Queenslanders are no longer left at the mercy of unaffordable, compulsory insurance products.