TOWNSVILLE, AAP – Two Queensland senators are at loggerheads over how to reduce insurance premiums for people living in the state’s north.

Labor’s Murray Watt and the Nationals’ Susan McDonald are co-chairing a federal Senate inquiry into the Morrison government’s northern Australia agenda.

However, they’re at an impasse over how to slash high insurance premiums for northern homeowners and businesses.

Premiums in the north have steadily risen with the region being exposed to increasingly unpredictable natural disasters including cyclones, storms and floods.

The Commonwealth has a plan for a reinsurance scheme, while the Australian Consumer and Competition Commission has recommended direct subsidies for consumers.

Senator Watt says the Commonwealth hasn’t listened to the ACCC and even insurers say the proposed reinsurance scheme won’t work.

“About 28 recommendations have been sitting around from the ACCC for well over a year and haven’t been implemented,” Senator Watt told the inquiry.

“We had witnesses give evidence today, who said that they had been attending forums and inquiries about northern Australia insurance costs since 2011 … for 10 years people have been complaining.”

The Labor senator said insurers were saying the reinsurance pool was just “some sort of hypothetical slogan by the federal government”.

“Insurers are yet to receive any detail from the government about what that would look like and how it would work,” he said.

Senator Watt said the government hadn’t spent any of its $50 million Disaster Mitigation fund.

Senator McDonald blamed the rocketing insurance premiums on the Queensland government.

She said it had been taking stamp duty premiums but not reinvesting the money in the state’s north.

The Nationals senator said the state government took $65 million in premiums in 2018- 2019, but only contributed $11 million towards reinforcing homes in the north.

“We have to see a reduction in stamp duty in Queensland, we cannot continue to see premiums rise and stamp duties tuck the money away down in Brisbane,” Senator McDonald said.

“We can be doing more around accurately assessing risk for insurance in north Queensland and reducing premiums and spreading risk right across the country.”

Townsville Mayor Jenny Hill fronted the inquiry to back a federal reinsurance pool, a plan supported by her fellow north Queensland mayors.

Ms Hill wants insurance premium costs reduced so residents and businesses can enjoy operating conditions that she says other parts of the country take for granted.

The Senate inquiry will hand down its final report on April 28.