Review of the Insurance Contracts Act , Australian Government, Department of the Treasury
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On 10 September 2003 the then Minister for Revenue and Assistant Treasurer, Senator Helen Coonan, and the then Parliamentary Secretary to the Treasurer, Senator Ian Campbell, jointly announced that the Government would be undertaking a comprehensive review of the Insurance Contracts Act 1984 (the Act).

Mr Alan Cameron A.M. and Ms Nancy Milne were appointed to a Review Panel to conduct the review. Mr Cameron has extensive experience in the public and private sector, including 8 years as Chairman of the Australian Securities and Investments Commission and its predecessor. Ms Milne is a specialist insurance lawyer and a consultant with Clayton Utz.

The Review Panel was supported by a secretariat located within The Treasury.

The objective of the review was to make recommendations aimed at improving the overall operation of the Act through correcting deficiencies and clarifying ambiguities in its operation.

The review set out to:

  • identify the specific provisions that do not operate satisfactorily and reasons for such deficiencies;
  • identify and recommend measures to ameliorate ambiguities in drafting or resulting from judicial interpretation;
  • recommend amendments (including new or the repeal of existing provisions), that would improve the operation of the Act; and
  • identify areas of the Act that operate in a satisfactory manner (that is, the specific areas that should not be amended and, if appropriate, why).

The review was conducted in two stages. The first stage examined the operation of section 54. The second stage reviewed the remainder of the Act.

Review of section 54 of the Insurance Contracts Act 1984

  • The final report on section 54 was provided to the Government on 31 October 2003. The report was released publicly on 18 November 2003.
  • A draft of possible legislative amendments was released for public comment on 8 March 2004.
  • The Review Panel reported to the Government on the public consultation process by letter of 28 May 2004.

Review of the remainder of the Insurance Contracts Act

The second stage of the review examined the balance of the Act.

  • In November 2003, the Review Panel sought submissions at large on issues relating to the Act (other than section 54).
  • After considering submissions at large, the Review Panel released an issues paper for comment on 24 March 2004.
  • Following consideration of written submissions and meetings the Review Panel had with stakeholders, a proposals paper on the balance of the Act was released on 25 May 2004.
  • The Review Panel delivered its report to Ministers on the remainder of the Act on 30 June 2004, after taking into account comments made on the proposals paper.

Next steps

A draft legislative package, including explanatory materials, to address the Review Panel’s key recommendations has been released for public comment. This includes proposed amendments to section 54 of the Act which take into account consultations on the previous exposure draft.

The Review Panel identified several other matters requiring further consideration, such as updating the standard cover regulations in consultation with stakeholders and collecting data on claims by innocent co insureds. Those recommendations will be progressed separately by The Treasury.