Page 879 - Week 03 - Tuesday, 20 March 2012
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MR BARR: I present the review of the Road Transport (Third-Party Insurance) Act 2008 under section 275 of the act. The Road Transport (Third-Party Insurance) Act 2008 administers the compulsory third-party scheme, CTP, in the territory. As indicated this morning, I acknowledge and regret the lateness of this review report. The CTP scheme actuary commenced analysis of the scheme data on 6 October 2011, and the government has been very keen to complete the review as soon as possible. However, the government is also equally keen to ensure that the review is comprehensive and that the technical experts such as actuaries are given ample time to undertake robust analysis.
One further issue to resolve is the treatment of the commercially confidential information from the sole CTP insurer, NRMA. Members would well be aware that the release of information in previous actuarial reports has been the subject of determinations by the administrative and civil appeals tribunal. The government has treated and continues to treat this information with appropriate sensitivity.
Let me turn now to the substance of the review. As members are well aware, prior to this legislation, premiums and insurer performance in the territory were unregulated. The 2008 legislation established a new structure for the administration of the CTP scheme and it was designed to enact provisions regulating CTP insurance premiums that are very familiar to insurers offering CTP in New South Wales and Queensland, to provide a new structure for dealing with CTP insurance claims which modernise claims handling and procedures, with the primary emphasis on health outcomes, and to require ACT CTP insurers to provide claims and related information in the same format as they do in both Queensland and New South Wales.
Section 275 of the act requires a review after its first three years, having regard to the criteria also set out in section 275. The review has been undertaken principally through an actuarial analysis of the impacts of the 2008 legislative changes, supplemented by research into health outcomes. The analysis was conducted by the scheme’s consulting actuaries and looked at around 11,400 finalised claims spanning the period before and after the legislative changes were introduced.
As to the review’s conclusions, some positive observations can reasonably be drawn from the analysis. Firstly, claims frequency has fallen, although this trend is evident in other jurisdictions and cannot be directly attributed to the changes in legislation. Claims are being reported more promptly, claims are being resolved more quickly and legal costs are slightly lower. There has, nonetheless, been an increase of $141 per policy since the legislation came into effect.
The review points out there are a range of factors that drive premiums. Not all of those factors were able or intended to be moderated by the legislative changes of 2008. It is also difficult to precisely attribute changes in premiums to the provisions of the act.
The report also recognises that not enough time has elapsed since the legislation was enacted to make comprehensive conclusions. Claims under CTP insurance can take a long time to finalise. As such, the actuary was only able to look at simpler claims that
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