News

Time to abolish Taxes on Insurance

News >>

Time to abolish Taxes on Insurance

An extra 20% of taxes are added onto all Queenslanders Insurance policies. For every $100 in premiums you pay, Goods and Services Tax (GST) is added to make $110 and then a further 9% is added by the Queensland Government in the form of a “Stamp Duty” to make a total of $119.90. This is also not taking into account a Terrorism Levy on all Property Insurance.

While the Queensland Government can point out that we still have the lowest Stamp Duty in Australia, along with NSW at 9%, it does not get away from the fact that the Insurance Industry was told prior to the introduction of a GST, that this tax would replace inefficient taxes such as State Government Stamp Duties, it did not happen. We were tricked by the Conservative Government at that time.

All property owners should protect their assets with Insurance, every person needs to have liability cover in case they accidentally cause injuries or property damage to another person. However adding $20 on top every $100 of premiums charged by Insurance Companies is a disincentive.

We hear politicians carrying on about the fact a Carbon Tax which has added only 1% to everyone’s electricity costs (offset by income tax cuts too) making it a major election issue, maybe insurance taxes are not an issue because you can avoid them by just not taking out any insurance policies? However everyone needs electricity, everyone needs power to run their machines and lights. However many people can also reduce these taxes by putting Solar Panels or wind turbines on their roofs.

Maybe such issues are not of interest to people because Insurance companies do not have a high standing in the community in the media’s eyes. They would have a better standing if Insurers could charge cheaper premiums making insurance more affordable for the risks covered.

I personally believe that taxes on the bad things that happen in society is a good incentive for people to reduce their activities. If a tax on petrol causes people to buy smaller less polluting cars, great. IF taxes on Cigarettes makes people smoke less, great. If taxes on Carbon pollution reduces emissions into the atmosphere, this is also good thing, especially if it leads to less weather related disasters.

So how much less does Queensland pay compare to other states? Well the ACT only pays 6% Stamp Duty. However, Victoria, Western Australia, Tasmania and the Northern Territory all pay 10% with South Australia the most expensive with 11%. It is true too that many companies can claim back the GST as an imputed tax credit. However, for the private consumer, they pay it all.

It is estimated that 83% of Householders under insure their homes. Worst still is that 42% of homes do not bother to have insurance. A lot of it has to do with Insurance being affordable for everyone. A situation not helped by having to pay an extra 20% in taxes.

I believe everyone should have insurance protection on everything they own or do. But I accept the fact not everyone can afford it, they are more likely to if Stamp Duties were abolished on Insurance Contracts.

Last changed: Aug 31 2013 at 11:59 AM

Comments

  1. None Found

Add Comment

Latest News

High Court dismisses Business Interruption Test Case

Today the High Court dismissed appeal by Insurers on the Business Interruption test case. Even the big insurers make silly mistakes! But you the policy holder may benefit if you were one of the 40% of Business Pack policy holders that added Business Interruption cover to their Business Pack. While it was never the intent of insurers to cover policyholders for the loss of income from a pandemic, the fact that insurers never factored in a risk premium for it, and the fact there is supposed to be a material or physical loss to trigger the Business Interruption section, none of that matters according to the highest Court in the land. So what was the mistake? Simply that when insurers defined what they considered to be the definition of an infectious disease, they referred to the Quarantine Act of 1908 which since was superseded by the Biodiversity Act of 2015. Because the Quarantine Act of 1908 no longer exists, apparently you cannot draw on this for a definition of an infectious disease? Not one of the insurers picked up on this! Shows how much interest we take on the business of Governments, except what is reported in the media.

read more

Three Years running - Insurance Brokerage of the Year 1 to 5 staff

Mandy and Robert Cooper were extremely honoured and astounded to once again win, Insurance Brokerage of the Year for 2020 from Insurance Business Australia magazine. This is the third year running.

While this year has not been the easiest of years for the business with Covid 19, the Recession, the hard market and issues at Lloyds of London, we are literally all in this together as an Insurance Industry.

CPR Insurance Services continues to make our clients the number one focus of our business while managing our relationships with Insurers, who we need more than ever in this market climate.

CPR Insurance Services are a highly ethical Brokerage with a reputation as a trusted advisor who always acts in the Client's best interests. Their experience, knowledge and expertise is amongst the highest in the industry.

CPR Insurance Services is now ten years old as a business and is proud of being an Authorised Representative of Ausure and their partnership with Steadfast, giving CPR the strength and backing to match it with any Broking firm in the Insurance Industry, but remain focussed on supporting the Small to Medium business segment.

Memberships of the National Insurance Brokers Association, Australia and New Zealand Institute of Insurance and Finance, Australian Insurance Law Association, Australian Professional Indemnity Group and the Australian Institute of Company Directors, ensures CPR Insurance Services maintains the high standard of knowledge and expertise required to be one of the best Brokerages in Australia.

CPR Insurance Services also plays a strong role in their local community supporting other Sporting Clubs and Community organisations. They also support and promote local businesses with their operation of the Kedron Brook Business Group who meet regularly and has 174 members.

We are truly honoured to receive this National award once again for the third year as a recognition of CPR Insurance Services contribution.

read more