Why some insurance premiums keep rising, and what to do at renewal

Why some Australian insurance premiums are still rising in 2026, why commercial classes are moving the other way, and the questions worth asking before your renewal falls due.

For many Australian households, farms and businesses, insurance costs have risen substantially over recent years. But by 2026, the picture is no longer the same across every type of insurance.

It helps to separate two questions. The first is what is happening in the wider market and outside your control. The second is what is happening in your own program, which is where the decisions sit.

What is driving premiums in 2026

Insurance pricing in 2026 is being pulled in different directions. For home and some property risks, rebuilding costs, claims severity, catastrophe exposure and the underlying characteristics of the property continue to affect premiums. QBE, for example, identifies repair and replacement costs, inflation, natural disasters, sums insured and claims history among the factors that can influence home premiums.

Affordability remains a concern across the insurance market, but renewal outcomes can differ significantly between clients. Location, the way a property or business is used, its claims experience and the way the risk is presented to insurers can all affect the result. Two businesses in the same industry can therefore receive very different renewal terms.

Cost pressure is not only about weather. In a March 2026 submission to the Parliamentary Joint Committee on Corporations and Financial Services, the Insurance Council of Australia argued that regulatory compliance and rising claims costs from litigation, often described as social inflation, are adding materially to the price of small business cover, alongside state taxes and duties.

“A higher premium is information about how the risk is being read, not simply a bill to be paid or shopped around.”

Not every class is moving the same way

Commercial insurance tells a different story. During 2026, increased insurer capacity and competition have created more favourable conditions across a number of commercial classes. That does not mean every client will receive a reduction, but some risks may attract more competition than they did during the harder market years.

So a client can hold a home policy rising on rebuilding costs, a farm property section reflecting its own catastrophe exposure, and another commercial section where insurer competition has improved, all in the same year. Reading the renewal as one number, or moving the whole program on the strength of one line, can overlook important differences in pricing, wording and risk.

What is inside your own renewal

Some of the movement comes from the wider market. Some comes from the individual risk, and that is where the renewal review becomes more useful. The items that most often affect a renewal include:

Sums insured and declared values that have been indexed upward to keep pace with rebuilding and replacement costs. Claims history, including small claims that were paid quickly and forgotten. Changes to the business or property that were notified during the year. Excess levels that were set when conditions were different. GST and applicable state-based duties, levies and other government charges, which can also affect the final amount payable.

Some of these are worth accepting. Indexation on a building sum insured, for instance, is usually protecting you from underinsurance rather than padding a premium. Others are worth testing.

Reducing premium without quietly reducing cover

The fastest way to lower a premium is to buy less cover, and it is the option most likely to be regretted at claim time. The choices worth weighing are usually about risk retention and risk quality rather than about stripping sections out.

Raising an excess where the business can carry more of the small losses transfers cost knowingly rather than accidentally. Documented risk improvements, whether that is fire separation, updated wiring, security, water management or a maintained safety system, may give an underwriter better information on which to assess the risk. Presenting the full insurance program coherently, with current values, claims information and risk improvements clearly documented, can help insurers assess the risk on its current merits. Reviewing business interruption indemnity periods and liability limits against how the operation runs now can find both gaps and excess.

What deserves care is removing a section entirely, cutting a sum insured below replacement cost, or accepting a cheaper wording without comparing what it excludes. Average or co-insurance clauses can reduce a claim payment where the sum insured is too low, so a saving today can be paid back several times over.

Where a broker earns their place

A broker cannot remove disaster cost or claims inflation from the market. What a broker can do is make sure the risk is presented properly, tested across insurers, and structured so that the premium reflects the risk as it stands today rather than as it was described three renewals ago.

That includes explaining what has changed and why, negotiating on wordings rather than price alone, and being straight about which parts of the increase are not negotiable. For a fuller picture of how that differs from arranging cover yourself, see buying through a broker compared with buying direct and what an insurance broker does.

A short renewal checklist

Start six to eight weeks before the renewal date rather than in the final week. Ask for a breakdown showing base premium separately from taxes and charges. Confirm which sums insured were indexed and by how much. List anything that changed in the business or on the property during the year. Check whether the excess structure still suits the way losses tend to arrive. Ask what the market alternatives look like, and what would be given up to take them.

How RMA can help

RMA Insurance Brokers works with farms, agribusinesses, rma network Members and country businesses across Australia. We review programs ahead of renewal, explain what is driving each movement, and negotiate with the market on structure and wording as well as price.

If your renewal has increased, or the reasons behind the movement are unclear, contact the RMA Insurance Brokers team to review what has changed, how your current insurance arrangements respond and whether anything should be addressed before renewal.