November 24th will be a sad day for the Territory whether you support or don’t support the sale of TIO. Cabinet had approved a deal last night for the Government-backed insurer to be split and sold.
Which ever way you look at it Territorians have been left in the dark and don’t understand why TIO needs to be sold and why the urgency.
Consultation with Territorians has been virtually non existent and the Government needs to fully explain the pros and cons.
TIO belongs to Territorians and provides the insurance cover we need in the Territory, makes a profit and gives back to the community.
Selling TIO increases the risks go higher premiums and there is no guarantee Territorians will continue to access the cyclone, flood and storm surge cover we need.
We don’t forget easily! After Suncorp was sold in Queensland home insurance rose to $10,000 in some areas or was withdrawn, because insurance companies viewed the risk of cyclone and flood to high in some areas, so those homeowners now have no protection. Selling TIO risks creating the same insurance crisis in the Territory.
Remember the Katherine Floods? We saw how important it was to have a Government-owned insurer when private insurers relying on loopholes
did not pay up or pushed families and businesses to the wall by delaying payouts.
Many people agree the NT Government does not have a mandate to sell TIO and Adam Giles has treated Territorians with arrogance.
THE Northern Territory will make $424 million from the sale of TIO.
German multinational Allianz will buy the company’s insurance arm, while People’s Choice Credit Union has agreed to purchase TIO’s banking arm.
Chief Minister Adam Giles said the NT Government had turned down an additional $185 million it could have made by selling the Motor Accidents Compensation scheme, which will remain in public hands.
The Government will set up an infrastructure development fund with $215 million from the sale.
Allianz flood controversy in Queensland
The mayor of a community that was heavily damaged in the Queensland 2011 floods has told the ABC that Allianz was one of the worst insurers to deal with.
Ipswich Mayor Paul Pisasale said Allianz failed to look after its policy holders.
“They’ve got their building high rises, they’ve got all the things they sponsor, but when it came to the community needs they gave every excuse in the world not to pay up,” he said.
“They gave me every definition of flood, they made up definitions. They were the last to learn out of all the insurance companies.”
But Mr Pisasale said he believed Allianz had changed as a company after the floods that devastated his community.
“I think you would find if we had another flood they would treat it differently but hopefully the experience they’ve had in Ipswich in and all over south-east Queensland will leave a better company for you guys to deal with in the Northern Territory,” he said.
“I hope they’ve learnt, I’m sure they have but at the end of the day Government’s have got to understand that some things they should hang on to themselves rather than just sell for the profits.”
Coverage won’t change, says Allianz
Allianz’s general manager of corporate affairs, Nicholas Schofield, has moved to reassure TIO customers concerned about the sale.
The insurer received negative feedback after failing to pay up for damage to thousands of home in Queensland when parts of the state were hit by severe floods in 2011.
But Mr Schofield said the insurer did not cover its customers for floods at that time.
“Up until 2012 Allianz’s home insurance policies excluded riverine flooding, so they had policies but didn’t have flood cover,” he said.
Allianz now offers optional flood insurance, he said.
Mr Schofield said TIO would continue to offer coverage for high-risk disasters like cyclones, storm surges and floods once the sale is finalised.
“The current coverage in TIO’s own policies will continue,” he said.
The new owners of TIO have conceded premiums will rise, but Mr Schofield said TIO had plans to introduce flood-based pricing next May anyway.
“The Government’s talked about the fact that TIO would need to move to more of a risk-based pricing policy in the future,” Mr Schofield said.
“What we’ve said is that we will phase that in over a number of years.”
Mr Schofield said Territorians will always have a choice to buy a TIO policy that covers the unique risks of the Territory.
“There won’t be any circumstances where that won’t be the case,” he said.
He added there would be no massive changes for TIO’s customers once the sale is finalised on January 2.
“If they’re expecting that there’s going to be some sort of radical change they’ll be somewhat disappointed, because our intention is to maintain TIO, its brand, its policy coverage and to invest and grow it into the future,” he said.
A recent NT News poll last week found 89 per cent of people were against privatisation. Seven per cent were in favour and four unsure.
Territorians have let their feelings be known:
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