Insurance premiums in Australia have surged by an average of 19% since the last federal election, raising significant concerns about affordability for consumers.

Despite claims of rising prices, the Insurance Council of Australia argues that the market remains competitive, attributing the increases to inflation and the escalating costs associated with extreme weather events.

In light of the industry's profitability, with shares in major insurers reaching record highs, Peter Dutton is advocating for increased competition to help lower these premiums.

However, experts are skeptical about whether breaking up these companies would truly enhance competition, suggesting that smaller firms might shy away from high-risk customers to maintain profitability.

Dutton has proposed a divestiture policy aimed at breaking up large insurance companies that are found to be overcharging customers, drawing parallels to similar measures being discussed for supermarkets.

Currently, four major insurers— IAG, Suncorp, Allianz, and QBE—dominate the market, controlling approximately 75% of home insurance policies in Australia.

In response to the rising costs, the Greens have introduced their own insurance policy aimed at reducing premiums, which includes proposals to abolish stamp duty and expand disaster coverage.

The Greens also assert that their policies could save Australians $4 billion in the first year, emphasizing a 'polluter pays' rule for fossil fuel companies.

Any potential reforms to insurance policy will hinge on the upcoming federal election, with the Labor party committed to making insurance more affordable but yet to outline specific reforms.

Dutton's comments regarding the divestiture plan have led to some confusion within the Coalition, as Nationals leader David Littleproud clarified that this proposal is not yet an official policy.