Insurance premiums are forecast to rise by up to 10% this year, due to a spate of weather-related payouts.
The Insurance Council says companies are feeling the pinch after unusually high claims resulting from floods and storms in the past three years.
It says the recession may also increase the number of fraudulent insurance claims.
The council says one in 10 of all insurance claims, worth about $300 million in total, are fraudulent.
