Governments should not tax insurance like alcohol and tobacco, Zurich chief David Smith says. Zurich chief executive David Smith called for tax on insurance to be banned at a Zurich media briefing held in Sydney yesterday afternoon. Looking back over 2009, Smith said one thing to come out of the Victorian bushfires aside from the horrific and tragic loss of life was the impact that high levels of underinsurance and non-insurance across both general and life insurance had.
"One of the main reasons for that level of underinsurance and non-insurance is really the affordability of insurance," Smith said.
"Insurance as a product has to be affordable for all Australians and it should not be taxed in such a punitive way as is the case for alcohol, tobacco or petrol. We urge the state governments who continually apply punitive product service levies to really look at the consequences of that and that is something you’re going to hear a lot more from us about because it is not right. It is not fair. It is inequitable and it is wrong."
Smith added that with the commencement of various reviews into the financial services industry and the reverberation of the global financial crisis, the pace of reform had accelerated at breakneck speed.
"Few areas have been spared with reports and proposed legislation flowing freely. Not a bad thing in moderation. And quite understandable given the tumultuous period we have suffered," Smith said.
"However any reform must be balanced. It must be well thought out reform that is building and developing our system in a coherent, fully integrated manner. It must be reform that promotes the interests of the customers we serve but also recognising the interests of all stakeholders."