Caravan park owners across Victoria are finding it increasingly difficult to find insurance companies that will cover them, as the global appetite for higher-risk insurance drops off, making reinsurance more difficult to obtain.
Franzi Weiss bought the Jamieson Caravan Park in the Victorian high country six years ago, and says that over the past four years her insurance premium has increased fivefold.
"Those costs are quite a lot of money to pay to carry on," Ms Weiss said.
"It's also becoming more difficult to get insurance with companies retreating from the industry.
"The ones that are still around are being more careful on what they're insuring."
The funding squeeze means it's becoming difficult for parks to find insurers that will cover activities such as jumping pillows.
Jamieson Caravan Park once had a water slide, but that has since been removed after failing to secure appropriate insurance.
"We're just trying to provide a fun and safe place for people to holiday. I hope we get better insurance again in the future."
'We've reached market failure'
Insurance broker David Hosking of Grampians Insurance Brokers said it was becoming increasingly stressful for caravan park owners.
"We're at the point now where it's reached market failure in terms of insurance," Mr Hosking said.
"Right now, if you bought a new caravan park and went to insure it, you'll find there is no-one in Australia prepared to do that.
"There's only one company and even then their premiums are simply unaffordable," he said.
Currently, insurance brokers are able to obtain public liability insurance for most parks, but not all.
Mr Hosking said it was the 'property and interruption' sections of insurance that were problematic.
"You can potentially still operate with public liability cover. That at least gives you cover for property and personal injury to any of your tenants or the public.
"But in terms of insuring your own property, your cabins, amenities blocks and all your infrastructure, unless you have an existing policy which potentially might be renewed.
"If you're a new entrant, you have no options at this point in time".
What next for caravan park owners?
A spokesperson from the Insurance Council of Australia said insurance globally was a 'hard' market, which meant capital was scarce and reinsurance was more difficult to obtain.
"Risk appetites are low, all of which can impact the cost of premiums locally, particularly those sectors that represent a higher insurance risk," the spokesperson said.
"The caravan park sector is one of the sectors that has been most impacted by the hard insurance market, which has seen some insurers withdraw from this sector."
The Insurance Council of Australia said they are working with brokers, key insurers and underwriting agencies to explore ways to address insurance affordability and availability.
"This process has identified that risk mitigation and risk reduction measures is the most effective way to put downward pressure on premiums for this sector," they said.
