Insurance for a block of units (I own only one) in Sydney. Is there a percentage? Ratio of property growth? Or something I should already know.
Insurance premiums are a factor of:
1. Increase in the costs of labour & materials etc to rebuild/fix
2. Claim history - i.e. are YOU a good risk
3. Postcode claim history - your neighbourhood
4. The insurer's financial position
5. Their re-insurance premiums that they pay to off-load some of their risk
6. The insurer's position in the market and where they want to be placed i.e. are they already the cheapest and can/will the market bear a price increase?
7. The whims of the board
I'm sure there are more factors but only one of the points above has anything to do with CPI.
*edit* Having just re-read the OPs Q, I suspect Mark & I have answered the Q: "How much should insurance premiums go up each year?"
I suspect the Q may have been: "How much should insurance cover go up each year?"
If the latter, then increase cover to cover the risk. Most insurers, if they have insured a block of units for $4M say, will automatically offer a cover of say $4.2M next year etc. I'd be inclined to go with the automatic indexing that they offer.