As previously reported, on 2 April 2020 the Australian Competition and Consumer Commission (ACCC) gave an Interim Authorisation for conduct jointly proposed by Suncorp, QBE and Allianz to provide assistance to SME insureds facing difficulties as a result of the COVID pandemic.
The ACCC has been seeking stakeholder comments on the Interim Authorisation and the National Insurance Brokers Association (NIBA) has provided a submission to the ACCC as well as speaking with ACCC officers to provide background information on the matter.
NIBA welcomed the initiative by the three major insurers (and also welcomes the initiatives offered by IAG and CGU of a similar nature). Insurance brokers recognise that many business owners are in real distress at the present time, and the insurance industry needs to help these clients wherever possible.
NIBA CEO Dallas Booth said, “We have advised the ACCC that there has been relatively few cases where the offer of a six-month deferral of premium has been taken up. The experience of insurance brokers in recent weeks is that clients prefer a periodic payment plan or a form of premium funding, rather than a simple deferral of the premium to a later date. There have been a small number of clients who have taken up the offer to defer payment.”
NIBA confirmed to the ACCC that if a significant number of clients defer payment of premium, the revenue position of smaller insurance broking firms could well become challenged, and it would be unfortunate if this had an impact on the ability of insurance brokers to provide advice and support to SME clients at this critical and challenging time. Booth said, “We do note that the Interim Authorisation only applies to SME insurance renewals due up to 30 June 2020.”
A copy of the NIBA submission to the ACCC is available on the NIBA website.