The floods in Townsville should put an end to any talk of a mutual
Over the past couple of years there has been much talk of setting up a mutual to cover property risks in North Queensland.
The reality is, had one been set up, this one event occurring in the first year of operation would have more than likely bankrupted the mutual and those that Insured through the mutual would have lost their premium and found themselves inadequately protected.
Others who suffered no damage, would also find that their premiums would have been lost and/or depending on how the mutual was set up, a call on further funds.
Insurance is about spreading the risk and setting up a mutual to cover North Queensland is simply not a viable option and hopefully this event will clearly demonstrate the folly of this approach.