The high cost of staying in many caravan parks, as well as the difficulty of even finding a site in some areas at some times of the year, are two of the most common gripes of grey nomads.
However, those in the van park industry often argue that there is a lack of understanding around some of the challenges that operators face.
Certainly, one of those challenges has been the steep rise in insurance premiums.
And there are fears that, unless something is done, there will gradually be less and less parks … despite strong demand.
Victorian Caravan Parks Association president, David Pratt, told the ABC that premiums for many businesses throughout the country had increased by as much as 300%.
Surging insurance premiums are making it difficult for some van parks to balance the books. PIC: Mikhail Nilov / Pexels
He said the premiums in many cases were equal to about 20% of the operator’s turnover.
“What this does is places many parks under immense financial pressure to even get property and liability cover,” he said.
Mr Pratt told the ABC the sky-high premiums were largely the result of international insurance company insurers walking away from the Australian market because the risk was deemed to be too high.
“Internationally, they all just take a position — whether it be from Europe or from America or from Canada — that they just don’t want to play in Australia anymore,” Mr Pratt said. “They either see us as on fire, underwater or on fire whilst underwater. They see Australia is not a good risk.”
Mr Pratt told the ABC the insurance market had reached a crisis point and that obtaining property and liability cover was impossible for many providers across the country.
The only insurance that the Southern Cross Caravan Park in the Victorian town of Lakes Entrance currently has is mandatory public liability coverage.
Owners, Julie and David Siacci, told the ABC that they are both nearing retirement age and rebuilding would be out of the question if disaster struck.
“Right now, I’ve got to live with the fact that if a bushfire comes through, that’s it — I’m done,” Ms Siacci said. “I can’t afford it.”
The ABC also spoke to Apex RiverBeach Holiday Park owner, Colin Stuart, who said his insurance had more than doubled in the past 12 months.
Eight months after the 2022-23 Victorian floods, the north-west Victorian businessman — whose park was inundated is choosing to self-insure — as the peak tourism season looms.
He said he was lucky he could keep liquid cash set aside to pay in the event of catastrophe, rather than paying an insurance company for cover.
“It is insanely expensive, so it’s not viable,” Mr Stuart said.
“It’s interesting, because having just been through the flood, we now know the exact cost of moving everything out of the park and moving everything back into the park, which was 50% less than the insurance premium.”
Mr Stuart said the 2022-23 flood crisis cost the business more than $100,000.
The ABC Reports that the Victorian Caravan Parks Association is calling on the federal government to intervene by engaging with insurers and participating in the reinsurance market.
That’s typical for Insurance companies I call it greed
It’s about time the governments go back into the insurance game so that prices can be controlled. Private enterprise is all about profit plus[ greed]
I call bullshit about the rises. What are the instigators for these so called rises. I am in the camp that believes that van parks raise their rates and then blame it on someone else. Profiteering. There is a caravan Park in Rocky that charges $23 a night. Go figure!!
For some people ‘facts’ are just not enough. Insurance is a COST to every business, all costs are then built into the price. Parks are expensive to buy and maintain. Are owners not entitled to a return on investment?
I respectfully suggest the park you mentioned is a council owned park with none of the above concerns.
Not every business is out to rip you off mate, we just need to make a profit to stay alive
It’s not just caravan parks. In QLD the CWA could only get one insurer to insure all CWA buildings because of the age of the buildings and flood, fire and storm risks. Even though they could get an insurer, they still have to self insure, which put up insurance premiums that many CWA’s across QLD couldn’t afford. In a few years the cost of insurance will be more than those tiny locations can afford and will force some to close. Such an iconic organisation but only one insurance company prepared to insure the buildings! Sad world we live in.
I’m sure reinsurance covers a lot of these insurers. Reinsurance gives them quite a bit of cover.