Rising premium costs have been defended by the Insurance Council of Australia, which claimed that ownership of numerous televisions and computer devices within households was causing insurance to rise.

Price comparison company Canstar found Tasmanian premiums rose an average 7 per cent for contents insurance, to $368 last year, and 11 per cent for building insurance.

TasCOSS chief executive Tony Reidy said up to 23 per cent of household budgets were dedicated to insurance.

Mr Reidy said this, coupled with the cost of living, had led struggling households to decide against contents insurance.

``Those households that are lucky enough to have their own home and are paying it off are already paying loan insurance in their repayments and are off to a bad start as it is,'' Mr Reidy said.

``In many instances, it is leaving them with so little disposable income that they are not properly insuring their home with contents insurance,'' he said.

``We are also hearing numerous stories where people are not comprehensively insuring their car - in an accident where the car is taken off the road, their poverty is made even worse.''

Tasmania Small Business Council chief executive Robert Mallett said cost-cutting measures included cutting insurance.

``People are going to start looking at the risk in their region, and looking at premiums and then weighing up whether they are prepared to take the risk,'' Mr Mallett said.

``It is more likely that small business will take out less insurance and put themselves at higher risks.''

An Insurance Council of Australia spokesman said floods and bushfires, and the increase of Tasmania's stamp duty to 10 per cent, also had an impact on premiums.

Rising crime rates were also taken into consideration, and in Launceston, home burglaries rose by 28 per cent last financial year.