Insurers forced to pass on costs after fire levy backflip

Insurance Council of Australia's Campbell Fuller said insurers were not consulted on the levy delay and the decision was shocking.
Insurance Council of Australia's Campbell Fuller said insurers were not consulted on the levy delay and the decision was shocking.

Households can expect heftier insurance bills after the NSW Government dumped its controversial fire levy, insurers warn.

The government proposed the Fire and Emergency Services Levy as a fairer system that would save the average fully insured property owner about $47 a year.

However, Premier Gladys Berejiklian said on Tuesday, May 30, it “had become clear that some fully insured businesses were facing unintended consequences”.

Insurance Council of Australia spokesperson Campbell Fuller said the decision was shocking and disappointing.

He said insurers were not consulted.

”The resumption of ESL collection (by insurers) will come with significant additional costs that the industry will be forced to pass on in full to policyholders,” Mr Fuller said.

The NSW Rural Fire Service Association (RFSA) reacted cautiously. 

RFSA president Ken Middleton called on the government to commit to its promise to protect fire-fighting services and funding.

“If the Government wishes to review the means of collecting the FESL that is their prerogative, but we have been provided with guarantees and we would not want to see those undertakings compromised by model changes.”

NSW Opposition leader Luke Foley questioned the NSW Government’s motive.

“It’s not because they want to do the right thing, but rather they have been caught out trying to pull the wool over the community’s eyes,” Mr Foley said.

“The Premier and her Treasurer told us they had done all their homework on this tax – they both get an F for fail.”