Insurer deems gas too risky, pulls farmers cover
AS FARMERS with coal seam gas (CSG) on their properties struggle to navigate their relationship with gas companies, Australia's leading rural insurance provider has issued a blow to landholders by no longer covering public liability.
Insurance Australia Group (IAG) said customers who "have operational CSG or shale gas activities or infrastructure on their property, such as a coal seam gas well, we will be unable to provide liability cover as part of their insurance policy".
Landholder advocate and consultant Shay Dougall said the move is not only concerning, but clearly demonstrates the lack of support farmers receive, and cements them at the bottom of the totem pole when it comes to multinational gas companies.
"This has been an issue for quite a while now … but for the company to say flat out 'we're not doing it - it's shocking," Ms Dougall said.
"If a farmer can't get public liability then he can't operate … he's too exposed and can't protect himself and that's an abhorrent situation to be in.
"Farmers don't have the right to say no to CSG, they are forced to have that relationship, that means they are importing a risk onto their property that they have no control over and very little information about, and now no insurance.
"The bottom line is, it's an interaction between an individual farmer and his family and a multinational company with the government just standing by and doing as much as possible to enable the industry and nothing to protect farmers."
Chinchilla broadacre farmer Brian Bender said IAG's announcement was another example of the Palaszczuk Government failing to properly regulate the industry.
"The government approved the coal seam gas industry but didn't worry about the consequences of its decisions, the politicians were only thinking about themselves and the royalties," he said.
"The government didn't worry about the landholder, and now the landholders who can't get insurance will be going after the State Government for compensation and at the end of the day we'll all be paying for it.
"I don't have gas on my property but my neighbour does, so companies aren't going to fully insure us either. We're downstream, so it's going to affect our property as well. It's pretty serious."
AgForce chief executive officer Michael Guerin said farmers can't farm without insurance.
"This could have devastating implication for thousands of primary producers, their families, their communities and the nation itself," Mr Guerin said.
"The effects could be more disastrous to agriculture - and the economy - than COVID-19.
"So far, only two insurers - albeit Australia's largest - have taken this unreasonable stance, but where they lead others may follow.
"With thousands of producers across the nation having to renew their insurance in a few weeks, this is a massive problem that needs an urgent resolution.
"CSG extraction is already an issue that polarises our industry - this development is only going to worsen producer and community opposition to the CSG industry.
"We are calling on the insurance industry to do the right thing, and for Government's to mandate a solution, if necessary, to protect thousands of Australian farmers."
LNP Shadow Agriculture Minister Tony Perrett said CSG should compensate landholders if insurance cost increases.
"If insurance becomes unobtainable then CSG companies will need to indemnify landholders, with appropriate legislative protections," Mr Perrett said.
"The LNP firmly believes that landholders must never be worse off than before any resource activities occur on their land.
"The only way the gas industry can work in Queensland is through coexistence with landholders."
At the end of last financial year, there were 6741 active CSG wells across inland Queensland, with many of those wells on private property.