Affiliation:
1. Melbourne Law School The University of Melbourne Carlton Victoria Australia
2. Redmond Barry Distinguished Professor Emeritus at Melbourne Law School The University of Melbourne Carlton Victoria Australia
3. Melbourne Law School, Melbourne Centre for Commercial Law The University of Melbourne Carlton Victoria Australia
Abstract
AbstractIn Australia, building, home contents, and comprehensive car insurance facilitate the accumulation of assets associated with rational, responsible citizenship while promising protection in case of events such as fire, flooding, car accident, or theft. Yet many Australians lack these insurance products, risking exposure to devastating financial losses when disaster strikes. This article compares the findings of online surveys of insured and uninsured Australians and explores the factors driving some to forego insurance coverage. Our findings show that inability to afford premiums is a major driver of noninsurance in Australia, particularly for people with low levels of disposable income and assets, or those living in areas affected by rising disaster risk. Yet the decision to forego insurance is also influenced by attitudes to financial matters. Australians who forego insurance have lower levels of trust in insurance and are less likely to consider themselves under a social obligation to be insured. However, contrary to portrayals of the uninsured as risk‐takers, the decision to forego coverage does not appear to be driven by lesser risk aversion among uninsured Australians relative to those who do purchase building, home contents, and comprehensive car insurance policies.
Funder
Australian Research Council
Reference84 articles.
1. ABS. (2017).2016 Census QuickStats. Australian Bureau of Statistics.
2. ABS. (2019).Housing occupancy and costs 2017–18. Cat No. 4130.0. Australian Bureau of Statistics.
3. ABS. (2021).Household financial resources December 2020. Australian Bureau of Statistics.
4. ABS. (2022).Household income and wealth Australia. 28 April 2022. Australian Bureau of Statistics.
5. ABS. (2024).Employee earnings and hours Australia. 24 January 2024. Australian Bureau of Statistics.