Australia's tourist industry was hit hard by the lockdowns made necessary to combat the coronavirus pandemic early last year., International airlines simply shut down and the inward flow of tourists ceased. Thousands from this country enjoying a holiday overseas were stranded in many parts of the world and repatriation is still uncertain.
The cessation of backpackers was disastrous for our fruit and vegetable industries. Last years crop went unpicked and was left to rot on the ground There was an expectation of a surge of unemployment but Federal government spending covered the shortfall and most jobs were saved.
Australians were urged to " holiday at home " and that saved many holiday resorts from bankruptcy. Now a vast vaccination programme is under way and tourist trade seems likely to return to pre-pandemic levels to service the loans that created those holiday resorts.
Just as owners and shareholders were expecting an end to this pandemic, a new threat has emerged. . The insurance industry has hiked premiums to unsustainable levels and many businesses face the prospect of trading uninsured.
That is a serious threat. One bushland retreat has been knocked back by thirty-eight insurance companies, save for an " insulting " offer of a $6.5 million premium for a business valued at just $ 3.5 million. It is obvious that the insurers are taking into account the extensive damage done during last summers bushfires. This property has been unaffected by bushfires in the past and is located in a Eucalypt forest where grey Kangaroos and Cockatoos outnumber guests.
Businesses warn that this escalating problem threatens to derail economic recovery in regional areas where operators have been battling natural disasters, border closures and pandemic lockdowns. It is evident that this problem has been kept from publication because it would affect resale values if the property became uninsurable.
This insurance problem would prevent new companies thinking of establishing bases in tourist areas and have a cascading effect on the existing supply chain. This highlighted a pressing need for government intervention.
It recommended expansion of the Federal government underwritten reinsurance of Reinsurance Pool Corporation to cover " significant natural events . In the May budget., a $ 10 billion government reinsurance pool was established to cover cyclone and flood damage in north Queensland.
Before the pandemic we had in place recognised tourist havens which attracted visitors from all over the world. The insurance cover that underpinned that structure is in danger of ending and with it will go our tourist trade.
The problem was passed back to the Federal government for rectification !
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