Letting insurance companies change CTP will cost Queenslanders more
8th Dec 2019
RACQ’s Re-Think CTP campaign for a no fault scheme isn’t re-thinking anything new, says Greg Spinda, QLD State President, ALA.
It’s the same tried and tested playbook that self-interested insurance companies like RACQ have run in other states to get no-fault schemes. The end result is always the same: premiums go up and entitlements for injured people go down.
There’s no surprises, it’s what insurance companies do. And with RACQ collecting $890 million in insurance fees annually, it’s little wonder they’re pushing for a no-fault scheme here that will see Queenslanders reaching even further into their hip pockets to pay CTP premiums.
But what is a no fault scheme and what’s it really going to cost Queenslanders?
In every state in mainland Australia where no fault schemes exist drivers pay more.
NSW is the clearest example of this, where drivers today pay a premium of $533.38 for a standard car, compared to Queenslanders who pay $359.20. If you are a younger driver in NSW you can pay up to $730 for CTP insurance, an eye watering amount for any young person or their parents.
But in looking at the very high costs people pay for CTP in NSW, it’s worth understanding what they’re actually getting for all that money paid in a no-fault scheme.
While anyone injured can access the scheme, this is only for six months. After this, injured people have to continually prove to insurance companies or the regulator that they are seriously injured to be covered for further treatment, and they have to show that someone other than them was at fault for their accident. That’s despite many people injured in car accidents taking much longer than six months to recover. There are also no costs covered for care provided for free by friends and family.
So an injured person in NSW not only has to keep dealing with their insurer to have their treatment paid, they also can’t get help at home. For some, that’s dealing with insurance companies for the rest of their lives. And all whilst paying premiums almost double what we pay in Queensland.
Queensland has the lowest CTP premiums in mainland Australia. We have a fair, rights-based scheme that sees insurance companies pay lump sum compensation to help for life – not a drip-fed benefits scheme where injured people have to constantly go cap in hand to their insurer.
Despite RACQ’s claims, no one is left behind in Queensland, including those injured where no one is at fault. There is the National Injury Insurance Scheme for people catastrophically injured, workers’ compensation for people injured driving to and from work and disability insurance rights to name a few. There is also a strict cap on legal fees in CTP claims, with fees disclosed to clients upfront. Courts or trustees also independently approve fees in many settlements.
With insurance revenue of $890 million, it’s not hard to see why RACQ want a no fault CTP scheme that only benefits insurers. But why anyone else would ever want such a scheme, which will see Queenslanders paying much more out of their own pockets and leaving them worse off, defies logic.
And that’s what will happen if we let RACQ have their way. Because letting the insurance companies like RACQ and their ReThink CTP campaign design insurance policies is like leaving your dog in charge of a hamburger.
Greg Spinda is the Queensland President of the Australian Lawyers Alliance.