Uncertainty continues with the NSW Government decision to reinstate the emergency services levy (NSW ESL) on insurance, but NIBA is on the front foot, meeting with the Treasurer early this week to share its concerns.
On Monday 5 June, NIBA President Tim Wedlock and CEO Dallas Booth met with the NSW Treasurer Dominic Perrottet to express our disappointment with the government’s decision to reinstate the emergency services levy on insurance premiums. While the Treasurer noted our concerns, he did confirm the government’s intention to defer the levy on property and reinstate the levy on insurance.
We took the opportunity to outline to the Treasurer a number of issues and concerns that will inevitably arise as this occurs, and the impact the levy will have on premiums and policyholders.
Later that day, NIBA representatives took part in an industry meeting with NSW Treasury and other officials, in order to discuss the transition back to an insurance-based levy.
At this stage, we can indicate that the government will introduce legislation to reinstate the levy on insurance premiums on 20 June. It expects the legislation to be passed shortly thereafter.
There are a number of issues that still need to be clarified, and we will not be able to give guidance to members until that occurs. These include:
- Details of the legislation that will reinstate the levy on insurance premiums – expected to be introduced into Parliament on 20 June;
- The amount of the levy that insurers will be required to raise during the 2017/2018 financial year;
- The timing of the reintroduction of the levy on premiums by insurers; and
- The approaches insurers are likely to take to reinstate the levy on premiums.
In these circumstances, brokers can certainly indicate to clients that the levy will be reinstated in the near future, but it is still too early to indicate what the levy will be and how and when the reinstatement will occur.
NIBA continues to work with the government to try to understand these issues, and we will provide further updates as information comes to hand.