Insurers want home cover tax deductible
The Insurance Council of Australia wants the Federal Government to make house and contents insurance tax-deductible to encourage more people to take out cover. The industry's push comes in the wake of recent bushfires. After the January Canberra fires, for example, the Insurance Disaster Response Organisation found that home contents were underinsured against replacement value by 30 to 50 per cent.
One in four Australian households has no insurance cover, according to the industry. Making premiums tax-deductible would ensure personal assets were protected properly. A similar 30 per cent rebate to the private health insurance incentive would be desirable.
But the Revenue Minister Helen Coonan said a 30 per cent rebate would cost about $700 million a year and tax deductibility would cost around $1 billion annually. As three out of four households already have house and contents cover, any government expenditure would go to people who already have cover rather than encouraging others to take out insurance, Ms Noonan said.