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Calls are growing for home insurance taxes to be lowered as hundreds of bushfire victims get no compensation because they could not afford cover.

Experts say thousands of New South Wales residents do not insure their homes because state government taxes make it too expensive.

New South Wales and Tasmania are the only jurisdictions in the country where emergency services are funded by a tax on insurance companies.

© Provided by Daily Mail Razed: A home recently destroyed by bushfires near the town of Bilpin on December 29 The emergency services levy in NSW is expected to raise $895million this financial year, covering 85 per cent of funding for the sector.

The tax effectively forces insurers to raise policy prices by around 25 per cent.

© Provided by Daily Mail A destroyed home is seen after a bushfire in Buxton, New South Wales on December 19

When stamp duty and GST are added, NSW residents pay 45 to 50 per cent tax on their insurance.

The Insurance Council of Australia says this puts people off getting insured at a time when bushfires are destroying thousands of homes.

Latest figures from 2015 showed only 82 per cent of NSW homes were insured compared with 89 per cent in Victoria.

ICA spokesman Campbell Fuller told the AFR: 'The ICA believes there is a direct link between the extra amount of tax paid by NSW households and businesses on insurance and the high level of non-insurance and underinsurance in the state compared with other jurisdictions.

In 2016 the NSW government passed a law to scrap the ESL and replace it with a broader tax on business and properties, as in other states.

But the law was never implemented as Premier Gladys Berejiklian said it would cost commercial and industrial property owners too much.

The ICA says the new law should be brought in as soon as possible.

© Provided by Daily Mail A destroyed home following bushfire damage on November 13 in Rainbow Flat, Australia

© Provided by Daily Mail The remains of a car that was destroyed by bushfires sits near a home in the town of Balmoral on December 30

'The current system is unfair, it's inequitable, it's difficult to administer, and it leads to significant detriment to consumers in NSW. We've argued this for many years,' said Mr Fuller.

'There are fairer ways to fund emergency services, through a broad-based property levy and/or through consolidated revenue. After all, the fire services are there to help all taxpayers.'

So far this season bushfires have caused $300million worth of damage - but this figure does not include uninsured losses and is expected to increase.

The emergency services levy The ESL is a levy on general insurers to fund emergency services organisations. Each insurer pays a total contribution to the NSW Government for ESL for each emergency services funding year, which commences 1 July. The contribution is set by the Government and adjusted according to the insurer's market share within the year. © Provided by Daily Mail This picture taken on December 31, 2019 shows a firefighter hosing down trees and flying embers in an effort to secure nearby houses from bushfires near the town of Nowra on the NSW south coast The insurer in practice needs to collect and fund this contribution by charging an ESL component on individual insurance policies, as a percentage of the base premium. This in practice normally applies to any premium, whether for a new or renewal policy or mid-term change Pictures: Australia's bushfire emergency The levy applies to the following types of insurance policies: Property (including consequential loss), house building and/or contents, personal effects (including jewellery, clothing and works of art), motor vehicle and motor cycle, marine and baggage, crop and livestock. Most Australian States and Territories have phased out this type of levy except New South Wales (NSW) and Tasmania.

On Thursday thousands of tourists were given less than 48 hours to evacuate fire-ravaged coastal communities as Australia braces for a heatwave Saturday expected to fan deadly bushfires.

Catastrophic blazes ripped through swathes of the continent's south-east on New Year's Eve, killing at least eight people and stranding holidaymakers as seaside towns were ringed by flames.

The New South Wales (NSW) Rural Fire Service on Thursday morning declared a 'tourist leave zone' stretching about 200km from Bateman's Bay to Victoria

Visitors are being warned to leave before Saturday, which is forecast to bring gusting winds and 45C heat.

That weather will create dangerous fire conditions that officials say will be as bad - if not worse - than Tuesday, Australia's deadliest day of fires in a months-long bushfire crisis.

At Microsoft News Australia we've partnered with the giving platform Benevity to raise funds for Australian Red Cross, St Vincent De Paul Society and The Salvation Army; these organisations are helping communities across the country devastated by bushfires. You can help these organisations by donating here and for the latest news and RFS links visit Bushfire emergency.