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April 26th, 2012 
FAKE NEWS for the Zionist agenda Governments have been warned that meddling in the insurance business could stop households and businesses making the tough decisions required to adapt to dangerous climate change.
The Productivity Commission has been asked to assess the barriers faced by households, businesses and governments when it comes to responding to the impacts of climate change that can’t be avoided.
It released its draft report on Friday.
The Intergovernmental Panel on Climate Change stated in late March that global warming was leading to such severe storms, droughts and heatwaves that nations should prepare for an unprecedented onslaught of dangerous and costly weather disasters.
But the Productivity Commission warns that intervening in insurance markets isn’t the way to go.
“If insurers are prevented from setting premiums in line with underlying risks this could distort the incentives that premiums give households and businesses to manage their risks effectively,” the draft report states.
“The costs to the community as a whole of subsidising insurance premiums are likely to exceed any benefit.”
The commission says a proposal for the commonwealth to require all household insurers to offer flood cover should only be adopted “if it can be demonstrated that the benefits to the wider community would exceed the costs”.
The report suggests a more appropriate response to concerns about the extent of flood cover would be to ensure people are better informed of their potential exposure to natural hazards.
Increased investment in flood-mitigation infrastructure should also be considered where this benefits the wider community, the report says.
The commission recommends phasing out state and territory taxes on general insurance which can “distort” the way people manage the risks they face.
Drought support payments are also in the firing line. The draft report states they “reduce incentives for agricultural businesses to be self-reliant” and impede economic and social adjustment to “changing circumstances”.
The commission recommends the federal government establish an independent review of the Natural Disaster Relief and Recovery Arrangements.
It suggests commonwealth funding following natural disasters may give rise to a “moral hazard” whereby states and territories which don’t face the full cost of rebuilding themselves have reduced incentives to ensure infrastructure is resilient to extreme weather events.
The draft report argues the commonwealth should also expand a project which aims to create a single portal for all flood maps so that it encompasses other natural hazards.
The final report is due to be handed to the federal government in September.
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