Manager
Company Announcements Office
Australian Stock Exchange Limited
Level 4, Exchange Centre
20 Bridge Street
SYDNEY NSW 2000
Fax: 1300 300 021
FOR IMMEDIATE RELEASE TO THE MARKET
Set out below is an announcement by the company in relation to a proposed community insurance pool.
IAG's share of the total premium pool from the community insurance pool is not expected to be material.
A major barrier to NSW and ACT-based not-for-profit community groups being able to get public liability cover may soon be removed through a co-insurance pool proposed by three of Australia's leading insurers.
The proposed community insurance pool was announced today by the NSW Premier, Bob Carr, Insurance Australia Group on behalf of NRMA Insurance Limited, Allianz Australia, QBE Insurance (Australia) and the Insurance Council of Australia.
The move follows this week's introduction of the second phase of crucial tort reform by the NSW Government.
Insurance Australia Group, Chief Executive Officer, Mr Michael Hawker, said this solution has been developed in response to the State's leading insurers listening to the community's calls for public liability insurance.
"Many volunteer and not-for-profit groups are struggling because they cannot get access to public liability insurance for events and activities which go to the very heart of what the community is all about," Mr Hawker said.
"While this pool will not solve the problems of every group, it should provide a sustainable solution for many community clubs and associations who, at the moment, just cannot get cover at all. This is the main reason why we have been involved in pulling these arrangements together.
"NRMA Insurance and IAG have a longstanding commitment to meeting the needs of the communities in which we operate. Our efforts to establish this pool, in an area of insurance in which we have not been heavily involved, is part of this commitment," Mr Hawker said.
Because the community insurance solution proposes pooling the resources of three competitors, it needs appropriate approval from the Australian Competition and Consumer Commission (ACCC) before it can proceed.
Discussions with the ACCC have begun and interim approval is being sought. Subject to this and passage of the proposed NSW reforms, cover can be offered to eligible community groups whose risk is predominantly in NSW.
Passage of the NSW reforms will help make offering this type of cover possible. IAG has today contacted other State and Territory Governments to press for similar legislative action.
Community Insurance should assist not-for-profit groups in areas such as personal services, cultural and recreational services, health and community services, interest groups and community radio and television operations.
Groups eligible for cover could include those with not-for-profit tax status, organisations structured for no profit distribution to members and volunteer membership associations.
Exceptions will include organisations with a poor loss history, unduly high risk and overseas exposures. The community insurance pool will develop an internal review process for groups who believe they should be eligible for cover based on special consideration.
Key features proposed include:
- up to $10 million cover;
- protection for employees and volunteers for liability claims against them from the public for personal injury or damage to property;
- a web-based application form supported by a toll-free help line (details to be announced);
- when the pool begins, groups will also be able to get access through insurance brokers and agents or direct through email to notforprofit@ica.com.au or by writing to the Insurance Council of Australia at Level 3, 56 Pitt Street, Sydney NSW 2000.
Media Relations
Name
Evnike Ens
Telephone
(02) 9292 9466
Mobile
0411 012 835
Investor Relations
Name
Anne O'Driscoll
Telephone
(02) 9292 3169
Mobile
0411 012 675
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