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Strata Insurance in FNQ: Navigating Cyclone Risks and Rising Premiums

Industrial Special Risks Insurance Strata and Body Corporate Insurance

Strata Insurance in FNQ: Navigating Cyclone Risks and Rising Premiums

Far North Queensland (FNQ) is renowned for its beauty—from the Daintree to the Cassowary Coast—but it’s also ground zero for some of Australia’s most intense weather. For strata owners and body corporates, this means navigating a minefield of insurance challenges, particularly when it comes to cyclone exposure.

Why is Strata Insurance So Expensive in FNQ?

Over the past decade, premiums for strata insurance in FNQ have risen sharply. The main reasons include:

Cyclone Frequency and Severity: FNQ sees more tropical cyclones than any other region in Australia. Events like Cyclone Yasi and Cyclone Larry caused billions in damage and reshaped insurer appetite.
Reinsurance Costs: Global reinsurers charge Australian insurers a premium to cover risks in cyclone-prone areas—costs which are passed on to owners.
Building Vulnerability: Older buildings with outdated roofing, inadequate drainage, or poor structural resilience face higher premiums—or worse, are deemed uninsurable.
Claims History: A high concentration of claims in towns like Cairns, Innisfail, and Mission Beach has created a red-flag zone for underwriters.

What Does Strata Insurance Cover?

Strata insurance policies in Queensland typically cover:

Building Replacement Costs (as required by law)
Common Property (roof, walls, hallways, gardens, pools)
Public Liability for the common areas
Catastrophic Weather Events, including cyclones, storms, and floods
Optional extras: Machinery breakdown, voluntary workers, office bearer’s liability

Challenges for Strata Owners in Cyclone Regions

Availability of Cover: Some insurers have exited the FNQ market altogether, forcing bodies corporate to seek cover from specialty markets or Lloyd’s of London.
Policy Exclusions: Cyclone excesses can be extremely high—sometimes $10,000 to $50,000 per event.
Rebuild and Compliance Gaps: After a cyclone, rebuild costs often exceed insured amounts due to new building code requirements.

How to Reduce Premiums & Improve Your Cover

At Wideland Insurance Brokers, we work with body corporates, strata managers, and individual owners across FNQ to find competitive and comprehensive cover—even in hard-to-place zones. Here are some strategies that may help:

Updated Sinking Fund Reports: Demonstrates financial health and ongoing maintenance
Mitigation Reports: Evidence of cyclone resilience (e.g. impact-resistant windows, roof tie-downs)
Specialist Insurers: Work with brokers who have access to underwriters willing to take on FNQ risks
Multiple Quotes: Some policies vary wildly in premium and excess structure
Group Schemes: If multiple strata plans are grouped under a single policy, savings can be substantial

Cyber Liability Insurance

Cyber Liability Insurance is designed to help protect you from claims and support your profitability in the event of a cyber breach or attack.

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Public Liability Insurance

Public Liability insurance is there to provide protection if someone makes a claim against the insured, the business or its employees.

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Business Insurance

A business insurance pack can provide cover for your business premises and contents, against loss, damage, theft or financial loss from an insured interruption to the business.

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Updated Sinking Fund Reports: Demonstrates financial health and ongoing maintenance
Mitigation Reports: Evidence of cyclone resilience (e.g. impact-resistant windows, roof tie-downs)
Specialist Insurers: Work with brokers who have access to underwriters willing to take on FNQ risks
Multiple Quotes: Some policies vary wildly in premium and excess structure
Group Schemes: If multiple strata plans are grouped under a single policy, savings can be substantial

A Glimpse at the Future: Government Reforms & Northern Australia Reinsurance Pool

The Federal Government’s Cyclone Reinsurance Pool, which began in 2022, aims to reduce premiums by offering reinsurance cover at a subsidised rate. Early results are mixed, but some insurers have reported savings for clients in high-risk zones.

Final Word

If you’re a strata owner in FNQ—whether in Cairns, Port Douglas, Atherton, or further afield—it’s never been more important to seek expert advice. The wrong policy can cost you thousands after a storm. A tailored approach that considers local risks, building resilience, and the evolving insurance market can make all the difference.

Need Help?
Talk to a strata insurance expert today. At Wideland Insurance Brokers, we specialise in hard-to-place risks and cyclone-prone regions, with offices across Queensland. We’ll help you get covered—properly.

Strata Insurance

General Advice Warning: This advice is general and does not take into account your objectives, financial situation or needs. You should consider whether the advice is appropriate for you and your personal circumstances. Before you make any decision about whether to acquire a certain product, you should obtain and read the relevant product disclosure statement.

All information above has been provided by the author.

Trent Sampson, Webinsure, ABN 32 054 247 666, AFSL 233750