Home, contents and strata insurance premiums are considerable higher in northern Australia than the rest of the country and have increased at a faster rate over the past decade, says the Australian Competition and Consumer Commission.

The commission has released the final report of its three-year Northern Australia Insurance Inquiry which found increased costs are leading to higher rates of households not insured for severe weather events.

ACCC deputy chair Delia Rickard said there were genuine reasons why premiums were more expensive in northern Australia as the risk of extreme weather is higher, and it can be costly for insurers to service the region.

"However, different insurers can quote vastly different premiums for the same property," she said.

"While many consumers could save by switching, it is harder than it should be for consumers to shop around."

The ACCC recommends governments use direct subsidies in a targeted way to relieve severe financial pressure faced by households in specific areas. This would cost less and be more effective than other measures like government reinsurance pools.

Other recommendations to provide immediate help include abolishing stamp duty on home insurance or - if it is maintained - that it be based on the sum insured for a property rather than the cost of the premium.

The ACCC found a portion of stamp duty revenue could be used to make insurance more affordable for low-income consumers or to fund mitigation works.

"However, the best outcome for consumers would be for stamp duty to no longer be applied to home, contents and strata insurance, which are often considered essential products that some households struggle to obtain," Ms Rickard said.

The ACCC recommended insurers help customers struggling to pay premiums by deferring payments, reducing or waiving surcharges for monthly payments, or offering payment plans.

"It is crucial that we help households hold onto their insurance, because becoming uninsured can result in much greater financial hardship in the future if homes or possessions are impacted by a severe event," she added.

The inquiry also recommended actions to make insurance more affordable in the future by reducing the risk of property loss or damage.

These included measures relating to the National Construction Code and developing voluntary standards for more resilient buildings.

The inquiry received more than 420 submissions and held forums in Townsville, Cairns, Rockhampton, Mackay, Broome, Karratha, Darwin and Alice Springs.

Australian Associated Press