FSL payments under microscope

The Victorian Fire Services Levy Monitor is confident it can reach agreement with a major insurer over $1.5 million it says is owed to customers.

Professor Allan Fels last week confirmed CGU was the only insurance company that had not agreed to refund customers all surplus funds it had collected through the levy.

As the individual over-collection amounts were quite small, CGU had instead refunded the $1.5 million to the Country Fire Authority earlier this year.

However, Fels says: “I made clear to the industry well before the abolition of the FSL on 1 July 2013 that the right principle to apply, if there was any over-collection of FSL for 2012-13, is to refund it to their customers, unless the amounts ‘per customer’ were minor or the administrative costs of refunds would be disproportionately high.”

Representatives from the two organisations met late last week, with both describing the discussions as productive.

“Both parties are confident they can reach a mutually satisfactory outcome,” a CGU spokesman says.

A total of 55 insurance companies have already agreed to refund $10.8 million in over-collections.

“The insurance industry on the whole has done the right thing by not retaining the surplus FSL which otherwise would have gone straight to their profit line,” Fels says.