Emergency Services Levy Insurance Monitor Releases Notice for Insurance Companies and Brokers

The Emergency Services Levy (ESL) notice information requiring Gazette has been released by the Emergency Services Levy Insurance Monitor along with the approved form of notice as well as guidance.

Under section 30 of the Emergency Services Levy Insurance Monitor Act 2016 (the Act) it is an offense for an insurance company or person acting on behalf of an insurance company to issue an invoice or statement about the price payable for a regulated contract of insurance unless the invoice or statement includes the information contained in the notice.

The notice obligation comes into effect on 24 July 2016. However the Monitor will allow a period of 12 weeks for the achievement of full compliance before taking any enforcement action.

Insurance companies that do not pass on the benefits of the NSW Government’s new Emergency Services Property Levy (ESPL) to households will face fines of up to $10 million, NSW Treasurer Gladys Berejiklian and Emergency Services Levy Insurance Monitor Alan Fels announced earlier this month.

Professor Fels and Deputy Monitor, Professor David Cousins AM, two of Australia’s most respected consumer watchdogs, will be responsible for protecting consumers against unreasonable pricing and ensuring insurance companies pass on savings to their customers as the government rolls out a fairer system of funding fire and emergency services.

The government announced in December that the insurance-based Emergency Services Levy (ESL) would be abolished and replaced with the ESPL, to be paid alongside council rates from 1 July 2017.

“Professors Fels and Cousins will be our ‘cops-on-the-beat’ to ensure savings are passed on to households as the government undertakes this important reform,” Treasurer Berejiklian said.

“It is absolutely imperative that insurance companies do the right thing and pass on the tax reductions in full,” Professor Fels said. “The aim is to totally eliminate the burden of the current tax on consumers and businesses.”

The Monitor has previously released draft guidelines to the insurance industry governing the abolition of the ESL, with penalties for prohibited conduct of up to $10 million for corporations and $500,000 for individuals.