The only casino in Far North Queensland has had its annual insurance bill hiked by almost 60 per cent, as insurers reassess the risk natural disasters and climate change pose to the state’s tourism operators.
Reef Casino Trust, the ASX-listed owner of the 128-room Reef Hotel Casino in Cairns, told investors on Thursday that its insurance bill would jump $487,000 per cent to $1.3 million in 2020.
The casino also had limits placed on how much it could claim for damage caused by cyclones, flood and tidal waves. The $487,000 increase in insurance costs represents close to 10 per cent of the group’s 2019 net profit ($5 million).
That hike followed a review with its insurance broker and was caused by “challenging market conditions in the insurance industry,” Reef Casino said.
Daniel Gschwind, chief executive of the Queensland Tourism Industry Council, said almost all tourism operators were facing insurance hikes with many having their premiums doubled year to year.
He said many, including marine tourism operators, could no longer get insurance for the operations at all.
“Insurance companies have for a number of years highlighted their concerns about climate change,” Mr Gschwind said.
“I guess they have made an assessment in terms of how globally we’ll deal with this – or not deal with this – and they’ve sent us the bill.”
Major insurance companies have warned that climate change threatens their business model and could make insurance too expensive in parts of Australia that are highly exposed to natural disasters.
Source: Thanks smh.com