WA: AMP should be slammed for not insuring cyclone areas: MP

AAP General News (Australia)
04-27-2001
WA: AMP should be slammed for not insuring cyclone areas: MP

PERTH, April 27 AAP - Financial services giant AMP should be widely condemned for its
decision to cease offering personal insurance products in cyclone and flood-prone Western
Australia, WA Senator Alan Eggleston said today.

Senator Eggleston was commenting after the big insurer said it had exited WA's north
west because of cost blow-outs due to cyclones.

He said strict building regulations in cyclone-prone areas meant the likelihood of
a cyclone damaging property was "actually pretty low".

"AMP should be widely condemned for their refusal to provide policies in the north-west,"

Senator Eggleston said.

"They appear to have chosen the example of Cyclone Vance in Exmouth to assess risk
in the region, without taking into consideration the stringent building guidelines in
places like Karratha, Dampier and Port Hedland."

The category-five Vance, one of the most savage cyclones on record, left a trail of
destruction along WA's north-west coast in March 1999, its 230kph winds ravaging towns,
closing ports and halting mining operations.

An AMP General Insurance spokesman said today AMP was a small player in the WA market,
which had made it difficult for it to compete effectively in the personal insurance market.

"In the past, premiums for other areas subsidised the cost of personal insurance in
north west WA," the spokesman said.

"We undertook a review of the underwriting of risks in the north-west (and) rather
than offer insurance at prices that would not be competitive, we decided it was better
to exit the north-west."

The spokesman said AMP remained committed to the state's north-west in other areas
including financial services and commercial insurance.

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KEYWORD: AMP

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