Posted 13/01/02

Insurers Trump Consumers to Steal Rights...

The anti-consumerist focus of these 'reforms' are the result of the review committee being told that insurance companies should be free to reap grossly increased insurance premiums while providing less to struggling Australians who deserve to be compensated for the unlawful acts of others.

The committee's report shows an alarming lack of insight into the Australian economy and the social issues concerning legal liability. The report also shows a glaring lack of analysis as to the causes of the insurance crisis. Namely the collapse of HIH and FAI, the management failures of the Australian Prudential Regulation Authority (APRA) and the September 11 terrorist attacks.

While the panel has argued that they were prevented from examining some vital material, the critical assumptions made in their report are clearly wrong.

Before the committee was established, insurance companies were lobbying governments to change the rules on insurance legislation but they fail to point out that these changes will not stop injuries from occurring.

The push for all states to dismantle their remaining consumer protection laws for injury compensation in line with recommendations made by Justice David Ipp are naive and unrealistic.
Big business and their insurance companies should be liable for the negligent acts that cause others harm. They should not be allowed to wriggle out of responsibility for their actions.

Allowing insurance companies the freedom to increase premiums while denying fair outcomes to innocent victims, transfers the cost of the reckless conduct from the duty-breaker to the victim and also to the taxpayer. Our nation's public hospital and welfare systems are already struggling; continuing to place extra pressure on these sectors will only result in their demise. The review committee's assumption that these sectors can accommodate further increases is unfounded.

The recommendations of the committee will also result in injured parties having to pick up the bill for medical investigation, legal and claim costs instead of the law-breaker or their insurer.

Insurers are also to gain the benefit of an injured consumer's private sickness or disability policy. They will be exempted from paying the victims' full income and superannuation loss. They are rewarded with reductions in the interest they must pay victims when they delay claims settlements.

Insurers have now convinced our governments that it is reasonable to shift the cost of recklessly caused injury from the law-breaker to the victim. That's good for insurance companies and a disaster for everyone else.