The announcement comes as Queenslanders continue to face the devastating impacts of extreme weather and many are also dealing with significant premium price increases from across the whole insurance industry.

Chief Executive Insurance Trent Sayers said while RACQ supported the introduction of a pool, the design and implementation of the current model means it will only deliver marginal benefits to members living in the north.

“Unfortunately, home insurance premiums will remain high despite RACQ passing on all the benefits gained from the pool to our members,” Mr Sayers said.

“This is a disappointing outcome, and with a review scheduled for 2025, RACQ will continue to recommend changes to the pool’s design that will achieve maximum benefits for homeowners.

“Any benefits the pool will provide will be more than offset by the affordability challenges facing the insurance industry, such as growing climate risk and inflation including significant increases in labour and building material costs.”

Mr Sayers said there were three important things members should know about the pool:

• The pool charges insurers for providing cyclone cover. It does not provide free cyclone cover to insurers.
• The pool only provides partial cyclone cover. For example, the pool will not cover insurers two days after the cyclone becomes an ex-tropical cyclone – this is when many weather systems cause most damage and results in insurers having to purchase reinsurance to cover the gap.
• The pool has been costly to implement - ongoing regulatory requests for information and system changes, which inevitably must be passed on.

Mr Sayers said RACQ shares the Federal Government’s ambition to keep insurance affordable and has long advocated for greater investments in natural disaster mitigation and resilience initiatives.

“The pool is just one measure - more needs to be done to better protect Queenslanders such as the removal of stamp duty, increasing disaster mitigation infrastructure, home upgrades and stronger land planning and building rules,” he said.

“Last month we commended the Federal Government for allocating $84 million of its $200 million Disaster Ready Fund to Queensland and for its commitment to building a long-awaited flood levee in Bundaberg.

“RACQ will continue to engage all levels of government on this important issue, while advocating on behalf of our members for initiatives and changes that will improve our resilience against the growing threat of climate change.”

For more information visit www.racq.com.au/help-contact/be-prepared/storms-and-cyclones/cyclone-reinsurance