In the State of Victoria people are been penalised by both State and Federal Governments for trying to insure their homes and contents, thus not been a drain on the wider Community should disaster strike and they lose their properties as they can recover through their insurance claims.

In my case I live in a Bushfire Zone, although not a flood Zone as the property is elevated and not near any water sources. The surge in insurance policy renewal costs has lifted my insurance from about $4,500 annual in 2021 to now $7,000 annual this year. Of that cost GST (Federal Tax) is $579.25 and Stamp Duty (State Tax) $637.19 totalling $1,216.44 of the policy cost for nothing in return, rather a disincentive to insure in the first place.

There is a strong incentive for me to not insure due to the massive increase in policy costs, and are not alone, I am aware many people in my area and across Australia are dropping insurance coverage altogether due to unaffordability. This creates a perverse situation where people are been taxed out of insuring their homes, only to be forced to rely on Government and Charities should disaster strike as they will be homeless due to lack of insurance cover.

Furthermore not been able to insure ones home also creates a situation where people will likely try and defend their properties against an extream event, risking their lives in the process, as opposed to taking the better option of retreating to safety which if insured would be the more likely course of action. 

Both State and Federal Governments need to recognise the vital need for insurance, both at personal and societal levels, and remove the disincentives of Stamp Duty and GST from the Home Insurance policies for which there is no justifiable reason to exist, as they are taxing people who already will have paid income tax.

Picture Source: https://pursuit.unimelb.edu.au/articles/black-saturday-bushfire-planning-as-our-population-grows