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- 21 May 2003
Motor Vehicle Third Party Insurance Premiums
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Page: 778
The Hon. Dr ARTHUR CHESTERFIELD-EVANS: My question without notice is directed to the Special Minister of State. Is it a fact that since the introduction of green slip legislation the amount taken in premiums is eight to nine times more than before the legislation? Is it also a fact that the amount paid out in claims is only 10 to 15 per cent of those premiums? Will the Minister now admit that the only people who have benefited from the legislation are the insurance companies?
The Hon. Greg Pearce: Good question, doctor. I didn't think you had it in you.
The Hon. JOHN DELLA BOSCA: It is interesting to reflect on the previous occupations of the Hon. Greg Pearce and the Hon. Dr Arthur Chesterfield-Evans—
The Hon. Michael Egan: A conflict of interest.
The Hon. JOHN DELLA BOSCA: —as that demonstrates a clear conflict of interest in their attitudes to the motor accidents scheme. They are not really interested in what happens to the victims of motor accidents or in the fact that New South Wales motorists simply cannot afford to keep paying yet more and more money to pay for the fees of solicitors and medical practitioners who are not actually engaging in treatment, which the Hippocratic oath otherwise would oblige them to do, but who are engaging in endless litigation and other evidentiary matters irrelevant to the treatment of victims. People injured in motor vehicle accidents are better off under the 1999 motor accidents compensation scheme. Those with serious injuries, such as brain damage, are clearly better off. The Motor Accidents Authority examined the results for claimants between October 1999 and October 2000. These claims are now reasonably well advanced.
The number one, but wrong, assumption implied in the question asked by the Hon. Dr Arthur Chesterfield-Evans is that one can simply take the slab of premium income against the outgoings from one year to the next and thereby equate how the scheme is performing. The honourable member knows, or ought to know from his previous occupation, that here we are talking about long-tail business. Many of the accidents and injuries involve claims that go on and on for many years, as well as some latent claims. Those claims are now, in the overall sense, reasonably well advanced, but not nearly as advanced as they would need to be to get a complete perspective on the full cost of the tail.
The time taken for people with brain injuries to get a decision on liability has been cut from 220 days to 136 days. It is still a fault scheme, but that is a big improvement for anybody suffering the distress of a brain injury. The average time for first payment has been cut from 212 days to 174 days. Of the 246 notifications, 51 have been finalised. None of these has required litigation. During the last year of the old scheme 26 per cent of claims required litigation. The average payments to individuals have also increased. Under the old scheme claimants received an average of $167,963. Under the new scheme the average payment is $233,331, up 37 per cent. The 1999 Motor Accidents Compensation Act better looks after the more seriously injured. Less of the premium dollar goes to legal costs and medico-legal costs and more is paid to seriously injured people.
The Hon. Dr ARTHUR CHESTERFIELD-EVANS: I wish to ask a supplementary question. Will the Minister please answer the question? Is it a fact that since the green slip legislation the amount taken in premiums is eight to nine times more than before the legislation? If the Minister does not have that information, will he take the question on notice and provide it at a later time? Is it also a fact that the amount paid out in claims is only 10 per cent to 15 per cent of these premiums? If the Minister cannot give me that information today, will he take the question on notice and come back with it at a later time?
The Hon. Jan Burnswoods: Point of order: That was not a supplementary question. It is a repetition of what the member asked earlier.
The Hon. Dr ARTHUR CHESTERFIELD-EVANS: To the point of order: The question was asked, but the Minister then produced a rant that was most defamatory and did not answer the question. I have merely asked that the question be answered in a quantitative sense rather than by way of a rhetorical rant. My question is a supplementary question as it relates to the answer, and it should be answered.
The PRESIDENT: Order! The question was not introducing new material. It might have been worded more felicitously, but I will allow it as a supplementary question.
The Hon. JOHN DELLA BOSCA: I am quite happy to make a couple of points about the honourable member's supplementary question. First of all, I gave a series of quantitative answers to his question. Indeed, most of my answer involved quantifying the extra benefits that motor accident victims reap from the new scheme, quantifying the lesser time they have to wait for their claims to be finalised and quantifying the better benefits they experience. I could, of course, state that green slip premiums are now much cheaper than they would have been under the previous scheme, but I will not do that because it is a separate issue.
The Hon. Duncan Gay: Because you can't.
The Hon. JOHN DELLA BOSCA: I can, but I will not. I have said ad nauseam, and this highlights the irrelevancy of the honourable member's question, that it is impossible—he ought to know this and I think he does, but he continues to feed populist, silly hysteria from time to time—to equate the amount of premiums collected to the outgoings because it is a long-tail scheme. The nature of the business is that claims against those premiums will continue for years, if not decades, after the claims are made.
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