This Green Paper introduces the Australian Actuaries Home Insurance Affordability (AAHIA) Index.
Affordable insurance is a key part of ensuring resilient communities.
The paper highlights that one million Australian homes (approximately 10%) spend more than four weeks of their gross annual income on home insurance, classified as vulnerable on the AAHIA Index. These vulnerable households are concentrated in the Northern Territory, Queensland and Northern NSW.
Affordability pressure is projected to intensify with climate change, and the impact will be greater for these already vulnerable households. The paper presents results under both a low and high emissions scenario.
Policy solutions to address home insurance affordability and the socioeconomic inequities of climate change are wide ranging and include multiple stakeholders.