In short:
Residents living near the Grampians are seeing huge increases in premiums only months after devastating bushfires.
The Insurance Council of Australia says there are many reasons why insurance premiums rise in fire-prone areas.
What's next?
Residents are calling for people who have been impacted by disasters to be protected from further financial strain.
Halls Gap resident Lisa Whyte was shocked to receive an email from her insurance company in Marchadvising her of a 500 per cent increase in her premium.
Up until that point, the single mother had been paying $175 a month. The new policy would take her premium to a whopping $1,009.
A bushfire had threatened Ms Whyte's property and other Halls Gap properties at the gateway to the northern Grampians a month earlier.
The same fire destroyed 46 homes in nearby Pomonal.
Ms Whyte said she felt scared and stressed over the increased premium.
"I think it's very insensitive, the timing [of this rise]," she said.
"People have lost homes. People have lost all of their belongings."
She said her insurer told her it had changed its underwriter and that it was a correct assessment of her region.
"I had hoped that it was some kind of mistake especially as it was so soon after the bushfire, and everyone was feeling quite vulnerable, emotional and sensitive," Ms Whyte said.
She said the premium increase was also abrupt and came without any clear communication.
"It was purely an email that said 'your premium was overdue'," she said.
Ms Whyte said she considered submitting a complaint to the Victorian Ombudsman over her insurer's "unprofessional" conduct.
After emails back and forth to negotiate a lower premium, the first $1,009 payment that was due was ultimately cancelled.
She later switched to another insurer which offered a premium of $400 per month.
It was still more than double her original premium.
Businesses taking risks
Halls Gap accommodation business owner Alan Wang, who also runs a motel in Apollo Bay, said he was told the previous owners had paid $9,000 in premiums a year before he took over last August.
"The previous owner tried to extend [his original policy] for one month, and I think they increased up to $4000 [for that extension]," he said.
When comparing premiums after buying the Halls Gap business, he said he didn't see any premiums for under $20,000 a year.
Despite the rise, he said he was up for the challenge to continue.
"It just means we have to work harder to get less profit," Mr Wang said.
He said other businesses could have to forgo insurance entirely to survive.
"There [are] some … business owners in the area that [won't] take a premium every year because of the high price," he said.
"Some of them take [the insurance premium] one year and then give it up the next year and try their luck."
Shopping around
A spokesperson for IAG, which in June 2023 started a general insurance partnership with Ms Whyte's insurer ANZ, said they always tried to keep premium increases to a minimum.
"This is why we advocate for greater investment in disaster mitigation measures to help reduce risk to lives, property and infrastructure due to severe weather and natural disasters," the IAG spokesperson said.
"This also is critical to improving insurance affordability."
They said IAG worked with governments to find opportunities for targeted investment in mitigation initiatives, improved land use planning to ensure homes weren't built in harm's way and stronger building codes.
The Insurance Council of Australia said rising insurance premiums "whether you're directly exposed to extreme weather impacts or not" was also due to many factors.
They included "the escalating costs of natural disasters, the increasing value of homes and vehicles making them more expensive to repair and replace, inflation in the building and vehicle repair sectors, and the increasing cost of doing business for insurers," an insurance council spokesperson said.
The spokesperson said property owners and tenants should either shop around, simplify their policy to cover assets they must insure, or lift their excess.
Ms Whyte said that was a scapegoat excuse.
"If the cost of buildings is increased, that's understandable, but then, we should have that increase [seen] in what we are covered for so it outlines a little bit more fairly," she said.
She said the community has "kept itself floating during these times of crisis," which made Halls Gap and Pomonal special places to live.
"But I do think the government needs to spend some time looking at these issues that make it hard to be everyday good Australians," she said.
