Insurance, in order to remain a viable business, needs to be profitable for insurers in the long run. Someone is paying for any insurance bonus one gets, just like with poker machines that have a set margin of return. If someone wins big, it means that multiple people have lost - and that excludes the margin the poker machine companies take out.
In terms of a disaster fund for Australia, I can't see why insurance is a better option than ensuring enough money is put aside. Perhaps it's for the short-term access to funds, but in the long run I can't see how insurance is a good idea. It seems inevitable that we're going to be paying more than what it would cost just to take care of it ourselves, otherwise who is paying for it?