NIBA has been active in recent weeks responding to proposals from the NSW Government to phase out broker commissions in the areas of home warranty insurance and CTP motor vehicle insurance.
Recently, the NSW Minister for Innovation and Better Regulation, Victor Dominello MP, announced reforms to the Home Building Compensation Fund (HBCF), in order to promote “private sector competition and innovation” in the home warranty scheme. One of the proposed reforms was the phasing out of broker commissions.
NIBA CEO Dallas Booth says: “In our discussions with members who are active in this area, it has become apparent that the government’s objectives will not be achieved, there will be little or no private sector involvement in the scheme in the short to medium term, and builders will be faced with significant premium increases.”
— NIBA (@NIBA_Australia) November 28, 2016
NIBA has met with the State Insurance Regulatory Authority and with icare HBCF to discuss the reforms. “We have made it very clear the government is unlikely to achieve its objectives, and we have again sought a meeting to discuss our concerns with the Minister,” Booth notes.
“We will continue to press for a meeting with the Minister to raise these concerns directly with him.”
NIBA has also made a submission to the State Insurance Regulatory Authority in response to proposals to reform CTP insurance in NSW. Again, the removal of broker commissions seems to be a key part of the reform process, even though the discussion paper sets out a clear desire to better manage poor risks and add greater pressure on commercial vehicle owners to improve their claims experience, Booth points out. “Insurance brokers play a vital role in this process, but the government does not appear to understand or appreciate the value brokers provide in this area.”
NIBA will continue to promote the role and value of brokers to the NSW Government, and we will continue to argue the important need to maintain broker involvement if the home warranty and CTP schemes are to remain successful.
Find out how else NIBA has been representing your interests from NIBA CEO Dallas Booth.