Insurance Adviser - May/June 2020

MAY/JUNE 2020

THE CYBER CRIME VIRUS

Is it out of control?

A PERFECT STORM

The challenges circling the construction sector

COVID-19 PULLOUT

Your guide to stimulus, relief measures and more

QPIB

A statement of professionalism WE ARE YOUR VOICE

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CONTENTS

May/June 2020

ACN 006 093 849 ABN 94 006 093 849

FEATURES

Insurance Adviser magazine is the monthly magazine of the National Insurance Brokers Association (NIBA).

Insurance Adviser magazine is published by NIBA

Publisher

Dallas Booth, CEO, NIBA T: (02) 9964 9400 E: dbooth@niba.com.au W: niba.com.au

Communications Manager Tiffany Eastland

NIBA Editor Tanaya Das

Editorial enquiries

E: editor@niba.com.au

National Sales Manager Tony May E: tmay@niba.com.au

Design

Citrus Media www.citrusmedia.com.au NIBA gives no warranty and makes no representation that the information contained in this magazine is, and will remain, suitable for any purpose or free from error.

22

THE QPIB DESIGNATION The path to professionalism

To the extent permitted by law, NIBA excludes responsibility and liability in respect of any loss arising in any way (including by way of negligence) from reliance on the information contained in this magazine or otherwise in connection with it.

The contents of Insurance Adviser are protected by copyright and NIBA reserves its rights in this regard.

Cover image: Adam Hollingworth

30

THE CYBER CRIME VIRUS

Are criminals taking advantage of the current disruption NIBA.COM.AU / 3

CONTENTS

May/June 2020

FEATURES

11 HOW TO FULFILL YOUR CPD REQUIREMENTS

NIBA Memberships Manager Audi Witsen identifies six ways to accrue your CPD points from the safety of your home

36 CHALLENGES GALORE Construction in the COVID-era

42 WORKPLACE RESILIENCE

Leading with emotional intelligence

IN EVERY ISSUE NIBA CEO welcome.................................... 6 Representation............................................ 8 Why be a NIBA member?......................... 10

NEWS

Industry bulletin........................................ 12

PROFESSIONALISM

IBCCC Tip of the Month................................ 16 AFCA case study ..............................................17 Staying connected with clients .................. 18 Building company culture........................... 20

66 FROM JUST A JOB TO A REWARDING CAREER

NIBA NSW Mentoring Committee Member and Senior Account Manager at Resilium, Angela O’Neil, tells us why she’s excited to be a part of this industry

4 / INSURANCE ADVISER MAY/JUNE 2020

REFERENCE Community hub .........................................58 Insurer strength ratings ..........................64

45 YOUR GUIDE TO COVID-19

CEO / Welcome

CEO WELCOME

T

he column I wrote for the previous edition of Insurance Adviser reflected the position in early March, not long after the Steadfast Convention had been called off, and the Australian Grand Prix had been cancelled. Some early stimulus packages had been announced by the Federal Government, but it was still very much “early days”.

We now live in a very different world. Social distancing, working from home and the eternal search for toilet paper in the supermarkets are now part of the normal way of life.

In recent weeks, a number of very interesting observations have been offered, and I would like to reflect on some of them.

First and foremost, we have a virus pandemic, with no immediate cure and no vaccination currently available.

Thousands have lost their lives around the globe, indicating this really is something that must be taken seriously indeed.

So, the health of ourselves, our families, our staff, our clients and everyone we deal with is paramount.

At the time of writing, there are early discussions of possible easing of restriction on community gatherings,

“I feel more strongly than ever that the successful broking firms will be the ones that are very closely connected to their clients and have very close personal relationships across the board.” with the potential for some businesses to return to work.

We do not know when things will start to return to ‘normal’, or even what ‘normal’ will look like.

Because of this, there is broad consensus that things will be different “on the other side”. Retail sales may be changed permanently, now that people know how easy online purchasing can be. Much greater reliance on technology, including home offices, will inevitably be a part of our ongoing experience. A well performing NBN has moved from a “nice to have” to an absolutely essential resource. We all now need a strong internet connection to continue our Zoom or WebEx meetings.

This means that the nature of work might well change more quickly than had been expected. Will we still need the number of offices and workstations that we had in 2019?

Will working from home become relatively normal?

Some industries will only recover slowly, particularly transport, tourism and hospitality. This will be a challenge for the owners and managers of those businesses. We wait to hear the outcome for the Virgin Australia airline.

What does all of this mean for the insurance broking firm of the future?

I feel more strongly than ever that the successful broking firms will be the ones that are very closely connected to their clients and have very close personal relationships

6 / INSURANCE ADVISER MAY/JUNE 2020

across the board. They will have a very clear idea of what it means to be a trusted adviser, and a keen understanding of the value proposition they offer.

It is also clear that the successful broking firms will be the ones that take advantage of the opportunities that will present themselves in the next 12 months. Flexibility, adaptability, and a willingness to experiment and develop new ideas, products and services will be the key. This will be important for insurers as well as insurance brokers and other key players in the value chain, including our friends in the underwriting agencies and the premium funders.

There must also be a strong re-commitment to true professionalism among insurance brokers, as nothing less is now expected from politicians, regulators, the media and the broader community. Insurance brokers are well placed in this regard, and NIBA itself has a long history of commitment to high standards of professional conduct.

At NIBA, we will re-commit to telling the story of the good work our members do to members of parliament, ministers, shadow ministers, regulators and other relevant stakeholders. We will continue to be the One Voice for insurance brokers in Australia.

Yes, it is going to be difficult in the next 12 months, but NIBA will support our members whenever and wherever we can.

A VIRTUAL NIBA CONVENTION?

I am delighted to indicate that the NIBA Board of Directors has agreed to our suggestion that we investigate holding a virtual NIBA Convention in October.

We believe the technology is available for this to happen, we already have a preliminary Convention program, and if it can work it will provide an ideal opportunity for all insurance brokers across Australia to get the latest news, information and technical learnings to help them with their work in these challenging times.

Please watch this space for further announcements.

DALLAS BOOTH Chief Executive Officer, NIBA

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NEWS / Representation

WE ARE YOUR VOICE!

NIBA's submission on behalf of brokers to the Royal Commission into National Natural Disasters Arrangements.

BY ALLYSSA HEXTELL, NIBA POLICY RESEARCH ANALYST

The black summer bushfires have had a profound influence on the national psyche.

Communities all over the country struggled while millions more watched the events unfold on the nightly news. Smoke from the bushfires affected neighbouring capital cities and could even be seen from space. Insured losses resulting from the bushfires reached over $1.9 billion, the impact on those who were not insured has yet to be measured.

Following the devastating 2019/20 bushfire season that saw more than 2,600 homes destroyed and 10 million hectares of land burnt, the Federal Government established the Royal Commission into National Natural Disaster Arrangements.

The Royal Commission, which began on 18 April has been tasked with investigating the nations preparedness and resilience in the face of future nationwide natural disasters.

As the peak representative body for general insurance brokers, NIBA has made a submission to the Royal Commission, highlighting the inequalities and inefficiencies in emergency services funding, as well as the need for a robust program of nationwide mitigation works.

NIBA has long campaigned for reform to emergency services funding, especially in the form of the New South Wales Emergency Services Levy (ESL), an inefficient and grossly unfair insurance-based levy that sees responsible property owners bear the burden of funding the NSW emergency services.

NIBA has raised concerns that the levy, set to balloon to over $1 billion next financial year, prevents policy owners from holding appropriate cover for their properties. The combined impact of the ESL and government taxes such as GST and stamp duty (which are charged on top of the ESL), can account for up to 70 per cent of

8 / INSURANCE ADVISER MAY/JUNE 2020

insurance premiums. This means that many property owners are forced to reduce their sum insured value to reduce the financial impact of insurance, or in some cases forgo insurance entirely, leading to higher rates of under-insurance and non-insurance.

This system also acts as an incentive for property owners to arrange alternative risk financing mechanisms, such as mutual pools and captive insurance, that do not attract the levy. While these arrangements can have many benefits for property owners who have access to the schemes, each time this occurs traditional policyholders have to shoulder a higher proportion of the ESL, as general insurers are each levied a pre-determined dollar amount and not a percentage rate on premiums.

All other mainland states have abandoned insurance-based levies in favour of a fairer, more broad-based property levies, whereby property owners contribute to the funding of emergency services via their council rates. Such arrangements overcome, many of the deficiencies of insurance-based levies and are broadly supported by general insurers, councils and insurance brokers.

NIBA has repeated its calls for a move to funding fire services by way of a propertybased levy to increase the efficiency, effectiveness, simplicity and transparency of emergency services funding.

NIBA has also highlighted the need for nationwide public and private mitigation works to alleviate, as far as reasonably

practicable, the potential risk to public safety and property during future bushfire seasons. While some mitigation works is currently carried out on a state-by-state basis, the Black Saturday bushfires highlight the need for a more comprehensive approach to public mitigation works as well as incentives for owners to undertake private mitigation works on their properties.

A 2014 Productivity Commission report found that Australian governments tended to “overinvest in post-disaster recovery and underinvest in mitigation�, noting that government mitigation spending accounted for only three per cent of postdisaster expenditure.

The government has set aside $2 billion to support bushfire recovery over the next two years, while many have predicted that the total economic impact of the Black Summer bushfires will exceed $4.4 billion. Addressing concerns over emergency services funding, increasing the affordability of property insurance and facilitating mitigation works have important flow on effects for governments, in that they reduce the incidence of government being called upon to provide ex-gratia assistance to individuals and businesses, as well as limiting the impact of future disasters if and when they occur.

You can access the submission in its entirety on the NIBA website: niba.com.au/ resource/NIBA%20submission%20Royal%20 Commission%20National%20Natural%20 Disaster%20Arrangements.pdf 

CONTACT NIBA

As always, brokers who have questions about these or any other government or regulatory matters should feel free to contact NIBA CEO Dallas Booth at: dbooth@niba.com.au

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NIBA / Membership

WHY NIBA MATTERS TO ME Members share why NIBA is important to them and the broking industry.

“NIBA is our advocate and presents a unified voice to government, industry and the community. NIBA continues to do the heavy lifting to convert rhetoric into tangible results for the industry and brokers with minimal fuss or fanfare.”

LEIGH STALKER NIBA VIC/TAS Committee Chair and General Manager at Capital Innovation

WELCOME TO NIBA

NIBA is thrilled have the following new principal member on board: • LaVerne Community Brokers Pty Ltd from NSW

ABOUT NIBA OUR MISSION

NIBA is the one voice for insurance brokers in Australia, representing their interests and promoting high standards of professionalism and competence.

OUR OBJECTIVES Representation

We represent the interests of members and their clients to governments, regulators, industry stakeholders, the media and the community in a manner that is respected and relevant. We have forged strong relationships at state and national level to ensure that your interests are represented.

10 / INSURANCE ADVISER MAY/JUNE 2020

Professionalism

We set and promote high standards of professional practice for insurance brokers for the benefit of their clients and the community through the development of professional standards, QPIB, CPD accreditation and the Insurance Brokers Code of Practice.

Community

We provide members with opportunities to meet, share, grow and prosper and build professional networks with the wider intermediated insurance community that will last throughout whole careers.

GET IN TOUCH!

Whatever your age, or level of experience, NIBA ha s brokers’ best interests at the core of everything we do. Fin d out what we can do to help be nefit your business and your tea m at niba.com.au/membe rship

COMMUNITY / Continuing Professional Development

HOW TO FULFILL YOUR CPD REQUIREMENTS NIBA Memberships Manager Audi Witsen identifies six ways to accrue your CPD points from the safety of your home.

Like all professional bodies, the National Insurance Brokers Association (NIBA) requires all practising members to obtain a minimum of 50 CPD points over each

two-year period. The current two year period is 1 January 2019 to 31 December 2020.

Ordinarily we encourage members to attend seminars, expos and conventions

1. Professional Reading (unstructured CPD)

If you’re reading this, the good news is you’re on your way! Reading the substantive content of one issue of a relevant professional journal, like Insurance Adviser, can earn you 1/2 a point per hour engaged.

Ensure you keep a record of the date and duration of reading undertaken.

Download a CPD reading record sheet at niba.com.au/resource/CPD_reading_record

2. Industry Research Activities (unstructured CPD)

Do you undertake activities to educate the wider industry? If so, you could be entitled to CPD points. Eligible activities include writing articles, giving presentations (including virtual), teaching, working on technical committee work, and student or workplace mentoring.

These activities are not listed on the NIBA CPD Register – points will be accredited on a case-by-case basis.

NB: Members can claim a maximum of 7.5 points annually for unstructured CPD.

4. Broker Market Survey

3. NIBA CPD Register

Quality Assessed programs deliver measurable learning outcomes and are assessed as exhibiting additional quality training criteria. All programs which meet the NIBA quality assessment can earn extra CPD points for participants.

These programs are listed on the NIBA CPD Register at niba.com.au/html/ cpd_register.cfm.

These are short courses and eLearning or other correspondence programs that met the basic CPD accreditation criteria.

The NIBA Broker Market Survey is the one opportunity each year when you can share your views on the performance of the insurance companies and underwriting agencies that you have dealt with over the past 12 months.

The survey provides a wealth of information to help insurance providers cultivate effective business relationships with brokers and ensure their products and services are competitive and responsive to broker client needs. Importantly, the survey is used to determine the recipients of NIBA’s General Insurance Awards.

It is an online survey that should take approximately 30 minutes and you will receive 2 CPD points for completion.

NB: You must be an Associate or Qualified Practising Insurance Broker to complete the Broker Market Survey.

BY AUDI WITSEN

NIBA Memberships Manager

to hit the target, but under the current circumstance, we understand this is simply not possible. Here are some alternative means for accruing CPD points:

5. NIBA Virtual Events

The NIBA Events Team have been busy planning a program of highly relevant webinars and virtual events.

If you haven’t had the opportunity to tune in to a NIBA webinar, don’t miss Michael Kelly, Founder and Director of Kelly Speech If you or a colleague have any questions Communication, present on reshaping relating to continuing professional your personal communication for a video development during COVID-19, contact conference world. This nationally broadcasted NIBA Memberships Manager Audi Witsen webinar will be held on 20 May at 2pm EST. at awitsen@niba.com.au.

Visit niba.com.au/html/events.cfm to register for this webinar and other virtual events, and be sure to subscribe to NIBA Events emails, if you haven’t already done so, by logging into your NIBA account (niba. com.au/html/login.cfm) and ticking the box next to events in Email Subscriptions.

Furthermore, NIBA are delighted to have partnered with CGU to bring our members a series of on-demand webinars, which can be accessed by registering your interest at niba. com.au/html/events.cfm

6. Just In! NIBA Convention 2.0 Planning is now underway for a virtual NIBA Convention, to be held in October, providing an opportunity for all insurance brokers across Australia to get the latest news, information and technical learnings to help them during these challenging times.

NIBA.COM.AU / 11

NEWS / Industry bulletin

Above 2018 Warren Tickle Memorial Award winner for Young Professional Broker of the Year, Craig Anderson.

NIBA AWARDS: THE SHOW WILL GO ON

T

he NIBA Board has made the decision to continue the NIBA Awards process for general insurers as well as the two key broking titles – the QBE-sponsored Broker of the Year Award for senior brokers and the Vero-sponsored Young Professional Broker of

the Year Award for the profession’s rising stars.

The nominations for this year’s NIBA Awards for broking closed on the 29th February 2020. Considering the COVID-19 situation, the program was paused to allow brokers to focus on their clients’ needs and

not add any unnecessary pressure by asking for submissions to be sent through during this unprecedented time.

A further update will be provided as we draw closer to announcing the national award winners.

ASIC LETTER TO GENERAL INSURERS

A

ustralian Securities and Investments Commission (ASIC) has written to the directors of general insurance companies regarding their expectations about insurer responses to the COVID-19 pandemic.

The regulator has indicated that it expects insurers to handle insurance claims with utmost good faith and to deal

with complaints genuinely, promptly, fairly and consistently.

The notice states, “Where consumers are no longer able to pay premiums due to reduced income, insurers should consider how they can best respond to this issue in order to help consumers continue to maintain key insurance coverage.”

The letter indicates that now more

than ever, it is important that general insurers stand by the commitments made in the 2020 General Insurance Code of Practice, to provide value, transparency and fairness; and promote trust, integrity and respect.

You can read the complete letter on the NIBA website: niba.com.au/resource/ASIC_ Letter_to_general_and_life_insurers.pdf

For breaking news and updates please visit: insuranceandrisk.com.au and to subscribe to our weekly newsletter Broker Buzz, email: info@niba.com.au

12 / INSURANCE ADVISER MAY/JUNE 2020

NEWS / Industry bulletin

MAJOR REFORM TO WA STRATA LAW COMMENCE

T

he amended Strata Titles Act 1985 and new Strata Titles (General) Regulations 2019 are now in effect and can be viewed on the State Government’s Legislation website.

Grace periods apply for some new requirements to ensure those affected have adequate time to meet them.

All new approved forms under the amended Strata Titles Act 1985 have been published on Landgate’s corporate website

for use effective 1 May 2020: landgate. wa.gov.au/for-individuals/forms-and-fees/ survey-and-strata-forms There is a wide range of support and resources now available through strata. wa.gov.au, including: • New strata guides and online presentations (video format) • Frequently asked questions • Links to the amended law and new regulations

INQUIRY INTO AUSTRALIA’S GENERAL INSURANCE INDUSTRY

I

nsurance Council of Australia (ICA) CEO, Rob Whelan gave evidence and provided an opening statement to the House of Representatives Economic Committee Inquiry into Australia’s General Insurance Industry.

Whelan said, “The Insurance Council’s members are rising to the challenges of natural disasters and the initial impact of COVID-19. They are helping customers affected by the pandemic through a wide range of assistance packages, including discounts, rebates and refunds.”

He stressed that this is especially important as Australia recovers from the immense economic and social pain caused by the pandemic and natural disasters.

National Insurance Brokers Association (NIBA) CEO, Dallas Booth said, “The opening statement shows the major challenges facing the insurance industry as a result of the summer fires, hail and storms. This emphasises the important role insurance plays in protecting people, businesses and the broader community in times of major loss.”

Whelan believes that the insurers are being flexible and adaptive in these

challenging times, “Insurance is a necessity.

It underpins the economy. We need to ensure the industry remains prudentially strong and retains the capacity to take on risk in the community.”

Whelan added, “This (2019-20) was the worst natural disaster season on record, and insurers are fulfilling their promise. They have made – and continue to make – strong progress in helping thousands of families and small businesses. They are paying claims, rebuilding and repairing properties.”

Since September, customers have lodged $4.6 billion from 242,000 insurance claims for damage caused by natural disasters, on top of the normal level of claims that insurers might reasonably expect.

Whelan said that the insurance industry is being disrupted by the COVID-19 pandemic in similar ways to most other businesses, “Even during a pandemic, customers lodge claims and need our support, but it is far from business as usual.”

He added that the insurance industry’s customer focus has never been more apparent than in these times of crisis and the industry’s Code of Practice also has a strong focus on financial hardship.

INFORMATION TO HELP BUSINESSES PREPARE FOR THE EASING OF COVID-19 RESTRICTIONS The Federal Government has contacted NIBA to indicate that every sector needs to prepare to operate in a COVID-safe manner once restrictions are removed, including through the development of protocols.

NIBA CEO Dallas Booth said, “NIBA has been asked to urge all sectors to expedite work to get ready. To help with this process, extensive information is available on the Safe Work Australia (SWA) website and from state and territory WHS authorities.”

“We urge all brokers to familiarise themselves with this information, and to share the information with your clients where appropriate.”

Examples include applying effective social distancing and hygiene measures and supporting arrangements for vulnerable workers.

This applies both to insurance broking firms and their staff, and to the operations of clients.

The Safe Work Australia website safeworkaustralia.gov.au contains detailed information for office work, as well as a wide range of other business activities. This includes information on how to assess and deal with potential COVID-19 risks in the workplace prior to the resumption of normal activities.

You can find the key considerations for undertaking risk assessment on the NIBA website: niba.com.au/ resource/200506%20COVID%20 19%20Risk%20Assessment%20 information.pdf

For breaking news and updates please visit: insuranceandrisk.com.au and to subscribe to our weekly newsletter Broker Buzz, email: info@niba.com.au

NIBA.COM.AU / 13

NEWS / Industry bulletin

THE REVIEW OF NSW HBCF

T

he NSW Independent Pricing and Regulatory Tribunal (IPART) is conducting a review of the home building compensation scheme in the state.

NIBA CEO Dallas Booth said, “Brokers play an important role helping their builder clients get the correct coverage from the scheme. We are interested in the views of

brokers on the issues raised by IPART, and on any alternative products that might achieve a similar level of protection for home owners and builders.”

As well as reviewing the home building compensation scheme in its current form, IPART has indicated it is interested in receiving information about products and

services that would provide more value to builders and to homeowners.

Responses to the Issues Paper are due on 1 June 2020. Interested insurance brokers can provide their comments directly to IPART, or can contribute to the NIBA submission on this issue by Friday 22 May 2020.

Above A deserted Bondi Beach during the Coronavirus (COVID-19) epidemic, Sydney, Australia, April 2020

NEW RESILIENCE NSW AGENCY ANNOUNCED

N

SW Premier Gladys Berejiklian has announced the creation of a new NSW Government agency, Resilience NSW, which will drive disaster preparedness and recovery approach for the state. She also revealed that RFS Commissioner Fitzsimmons will lead the new agency.

She said, “We know the next six months will be very difficult but we must already

turn our mind to recovery. Through Resilience NSW we will re-double our efforts to prevent, prepare and recover from crises which impact NSW.” Commissioner Fitzsimmons said, “There was never a more important time to make sure that communities devastated by drought, bushfires and now COVID-19 are getting the help they need to rebuild and recover.”

The Insurance Council of Australia (ICA) Head of Risk and Operations Karl Sullivan said: “It is the right time to establish a new agency as we all work together to tackle the issues arising from COVID-19, while still supporting the hundreds of communities that have felt the impact of bushfires, hailstorms, floods and storms during the 2019-2020 season of natural disasters.”

For breaking news and updates please visit: insuranceandrisk.com.au and to subscribe to our weekly newsletter Broker Buzz, email: info@niba.com.au

14 / INSURANCE ADVISER MAY/JUNE 2020

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PROFESSIONALISM / IBCCC Tip of the Month

SHINING A SPOTLIGHT ON INDUSTRY BEHAVIOUR Our mission to promote good practice continues in these uncertain times, with a special focus in the year ahead on understanding behaviour and changing it for the better.

T

he Insurance Brokers Code Compliance Committee (the Committee) recognises that insurance brokers and their clients face unprecedented challenges due to the COVID-19 pandemic – especially given many Code-subscribing brokers are small business operations.

The obligations built into the Insurance Brokers Code of Practice are particularly relevant in challenging times, not least Service Standard 9 to respond to catastrophes and disasters in a timely, professional, practical and compassionate manner in conjunction with any industry-wide response.

The Committee acknowledges that meeting the needs of clients while managing altered staffing arrangements may make it difficult to meet Committee requests. We are here to help, so please work with us if you encounter problems.

The Committee’s work in monitoring compliance with the Code and guiding subscribers towards good practice will continue. However, the Committee’s 2020-21 activities will be more focused on moving beyond technical compliance and instead towards good behaviour. This is in line with our vision and addresses concerns raised in the Financial Services Royal Commission, which found that issues were often caused by the underlying behaviour of institutions rather than by existing laws and regulations.

The data supplied by Code subscribers for the Annual Compliance Statement (ACS) is a critical part of this strategy, allowing us to establish and benchmark current behaviours. The benchmarked information will be an invaluable selfimprovement tool for subscribers.

To complement this data, the

16 / INSURANCE ADVISER MAY/JUNE 2020

“The Royal Commission found that the issue was often the underlying behaviour in financial service entities rather than existing laws and regulations”

Committee will engage directly with industry participants and leaders in the coming year to identify problematic behaviour and assemble case studies demonstrating both good and bad practice. This intelligence-gathering will involve the Australian Small Business and Family Enterprise Ombudsman, its equivalent state and territory bodies and the many advisory and industry bodies associated with these groups.

The Committee’s Code breach monitoring and reporting duties will continue as normal, with it providing feedback to industry and consumer advocates about outcomes and insights.

Particular aims for 2020-21 include improving the collection and analysis of self-reported breach and complaints data; enhancing transparency; and, strengthening the ability to collect information from multiple sources.

Identifying problematic areas is an essential ingredient of change, but full insight into the way our industry conducts itself also requires the recognition and promotion of appropriate behaviours. The Financial Services Royal Commission has provided an opportunity to shift the way Australia thinks about the

conduct of financial service providers.

We can no longer afford to simply look at legal compliance alone.

The Committee plans to use this opportunity to examine and engage with insurance broker behaviour and guide the industry wherever possible.

The Committee will continue to provide written guidance about good practice by sharing case studies and examples drawn from its intelligencegathering process, while encouraging stakeholders to actively share information about industry practice too. The Committee also aims to promote understanding of its work and the Code’s benefits among subscribers, the wider community, regulators and the board of the National Insurance Broker’s Association.

Ultimately, all of the activities aimed at gaining insight into industry behaviour will contribute to a formal Committee project examining the underlying themes and drivers of poor behaviour and developing techniques we can all use to create good behaviours.

This focus on bringing about real change in industry behaviour is an exciting direction and, we hope, will prove valuable for industry and consumers alike.

PROFESSIONALISM / AFCA case study

GROUP COVER AND DUTY OF CARE What are an insurance broker’s obligations when it comes to group policies?

BY MARK RADFORD

Principal, Radford Lawyers

Lessons to be learned

The key lessons from this Determination are that: • An insurance broker has a duty of care when acting on behalf of its client. The standard of care in exercising this duty is that of a competent and experienced broker; • AFCA looks to whom the client actually was, in assessing the duty. In this case, the complainant was not the insured party, rather a trustee and her mother’s estate on whose behalf the trustee acted, that the broker had arranged a group policy for; • The result might change if an insurance broker were to engage with parties beyond its client extending the duty to them; • When arranging an insurance policy for a client, a broker must ensure the policy covers the risks necessary to address the client’s disclosed or ascertained needs. A broker is also expected to undertake reasonable enquiries to identify the client’s needs; and • A complainant bears the onus of establishing that, on the balance of probabilities, the broker has breached its duty. If the complainant can establish this, the broker is liable for any loss the complainant has suffered because of the breach.

In this case, the determination was in favour of the insurance broker as the complainant was not its client. AFCA did note that the complainant’s issues were ones she may wish to take up with the trustee.

Facts

The complaint was in relation to the actions of a broker in arranging a home and contents insurance policy which did not respond to the complainant’s claim

for damage to a swimming pool at the insured property.

The complainant lodged a claim under the policy after a severe storm/rain event which damaged the pool. However, the claim was denied because the damage was caused by “flood” and the flood damage to swimming pools was excluded under the policy.

The policy did include “flood” cover, but that cover did not extend to the swimming pool.

The complainant’s case

The complainant submitted that the broker breached its duty to her by arranging a policy that was not sufficient to meet her insurance needs.

The complainant also submitted that the broker should: • pay the repair costs for the swimming pool, to put her back in the position she would have been in if not for the broker’s actions; and • pay compensation for non-financial loss because she had a disability and had been unable to use the pool which assisted her in dealing with that disability.

The broker’s case

According to AFCA, the property was insured in the joint names of the complainant’s mother’s estate and ‘NTG’, the trustee of that estate. The broker sourced a form of ‘group’ cover for the trustee (and the trustee’s many different clients), which was intended to provide as broad a policy as possible within certain cost constraints.

The process was for the trustee to purchase a policy electronically on behalf of the trustee’s individual clients (in this

case, the estate of the complainant’s mother).

It was NTG and not the complainant that was its client and it had met its duty to NTG.

Was the broker liable for the complainant’s loss?

The answer was no because there was no breach of duty.

AFCA noted that even if it was shown that the broker had a duty to the complainant herself and had breached it, it was not satisfied she suffered a loss due to the broker’s actions.

Whilst the complainant provided examples of policies offered by other insurers, which she believed would have covered the damage to the pool, the circumstances of the damage sustained to the swimming pool would not necessarily be covered by any or all of those other policies. That was because they too included certain restrictions and exclusions on flood cover for pools (including, for example, for damage from hydrostatic pressure).

Interestingly, AFCA also noted that: • the complainant had stressed the property was not in a ‘floodprone’ area or a formally designated flood zone and on that basis was not persuaded that the complainant (had she been responsible for taking out the policy) would have sought extra ‘flood’ cover specifically for the pool, considering also the likelihood of an increased premium; and • AFCA did not consider that the broker (had it been required to advise the complainant) would reasonably have anticipated that was required, in the absence of specific instructions to that effect.

NIBA.COM.AU / 17

PROFESSIONALISM / Staying connected

STAYING CONNECTED IS MORE IMPORTANT THAN EVER There is absolutely no doubt that 2020 will go down in history, remembered by many as a year filled with uncertainty, numerous challenges and a heck of a lot of change. For those, who are still fortunate enough to be employed, navigating working from home and maintaining a business focus has certainly presented some difficulty.

T

he current circumstances can also be isolating and lonely, particularly for those who may be on their own.

Learning to work within this new ‘norm’ requires perseverance and has definitely produced an increased level of personal creativity and innovation.

Amongst other things, dinner tables have now been set up to become dedicated work spaces and virtual meetings have replaced the usual face-to-face catch ups.

Insurance broking, like my own profession, is fundamentally a relationship driven environment and maintaining client and/or peer connections, whilst working in lock-down or isolation, can definitely prove to be problematic. For me personally at this point, my business is temporarily on ‘pause’.

However, I started to consider various communication strategies I could implement that would allow me to continue to engage with and maintain critical connections with my key contacts.

Now, more than ever, I believe that it’s crucial to build on your professional visibility, reinforce client relationships and provide reassurance that you’ll be ready to move forward when all of this madness is over. Likewise, many of our contacts are also doing it tough and their businesses may be in severe distress.

Therefore, reaching out and strengthening connections with others, may be beneficial to their financial or emotional well-being. Bear in mind, a proportion of the conversations you may have with clients during this time may be highly emotional or even, downright tough. Being adequately prepared to assist where possible, provide the correct advice and demonstrating empathy will

18 / INSURANCE ADVISER MAY/JUNE 2020

all assist to better manage these difficult conversations.

The notion of staying connected during this lock-down period means that it’s definitely not the time to promote, sell or spruik new offerings but quite simply, the time to check-in and say hello. Regular communication and keeping in contact is vital during this period of adjustment and helps builds a sense of community.

Fortunately, we are living in an age where we have an abundance of technology and resources available that allows us to ‘stay in touch’ and importantly, continue to meet work commitments. Here are some strategies to promote communication with others: 1. Zoom, Microsoft Teams, Skype – the beauty of these platforms is that they mirror face-to-face meetings and allow you to conduct videoconferencing or meetings whilst working remotely. They are very easy to download and simple to use on any device. (Note: can also be used for family catch-ups or virtual drinks with friends).

2. Facebook – if your business has a Facebook page, then be sure to continue posting and updating it regularly. Consider posting content or images that generate positivity or fun as we’ve all had enough of the doom and gloom media messages!

3. LinkedIn – as with Facebook, regularly post or share content.

This is a great platform to keep clients and peers advised of relevant updates and any new things you’re currently working on.

4. Free Webinars – these online, short video sessions provide the

BY NIKKI HEALD

Director at Corptraining

forum for you to communicate your insurance expertise, in an interactive way. Think about interesting and relevant topics that may be useful to others during this time. At-home isolation has created an environment whereby people have more time and are more inclined to participate in something that is participatory and engaging.

5. Email – when was the last time you sent an email to one of your networks to simply say hello, with no intended purposed or outcome? Now is the perfect opportunity to do a quick email check-in and the very nature of this tool allows you to do a bulk contact all at once.

6. Podcasts – easy to produce, these digital files allow you to broadcast a series of audio content that others can download and listen to. Consider some practical topics or insurance information that your target market or clients should be aware of post COVID-19. Also, include rotating speakers so as to mix it up and make it more interesting.

7. Phone call – yes, that’s right a good old-fashioned phone call. Remember, this is the quickest and easiest way you can maintain connections – it’s also the most personal. Create a list and set yourself a target to call X number of clients/peers per day.

Whilst I appreciate the above tips are not the same as personally chatting with clients or business associates, however, for the time being these desperate times call for different measures. Hopefully, it won’t be too long until we’re all back to being ‘busy’, although, I must admit that I’ll definitely miss the family time.

ADVERTORIAL / COVID-19 cyber risks

PREYING ON THE VULNERABLE – COVID-19 CYBER RISKS

BY KIERAN DOYLE Wotton + Kearney

Coronavirus (COVID-19) is potentially the largest cyber-security threat that businesses and consumers have ever faced. Wotton + Kearney’s Kieran Doyle looks at three key cyber vulnerabilities: remote working, targeting of key organisations, and phishing scams.

Remote working Many businesses were underprepared to have the majority (if not all) of their workforce working remotely. With hastily implemented remote working solutions there may be issues with technical and administrative controls, such as improper VPN configurations, installation of less robust software versions, and failure to install regular updates and patches.

Employees are also now accessing company data from a range of devices, including personal devices. This creates an increased risk for organisations if personal devices and accounts are compromised.

There has also been a surge in the use of third-party virtual conferencing and other collaboration tools, all of which are likely to attract opportunistic cyber criminals. Zoom, in particular, has been publicly criticised recently for its security vulnerabilities at a time where its usage is surging.1 2020 has already seen an increase in ransomware attacks with higher ransoms being demanded in conjunction with data exfiltration threats. We predict this trend will continue to grow rapidly, with hackers targeting business or home network vulnerabilities of remote workers.

Targeting of key organisations or sectors Many businesses, including restaurants, pubs, cinemas, retail stores and gyms, have been forced to close as a result of COVID-19. This has provided cyber criminals with a perfect blueprint for targets as businesses are mothballed, systems are left unattended, and employee reaction time has slowed.

We expect to see a significant increase in business email compromise scams and invoice fraud, particularly as businesses close and cash flow becomes critical.

According to a report from global insurer Beazley, the healthcare sector suffered 35 per cent of ransomware incidents in 2019, more than any other sector.2 Numerous incidents have already been reported in the healthcare sector since the outbreak, for example Hammersmith Medicines Research, a UK medical facility on standby to help test a COVID-19 vaccine, suffered an attempted ransomware attack earlier this year.3 Public authorities and associated private enterprises are also vulnerable targets, as governments roll out stimulus packages aimed at keeping businesses afloat and reducing unemployment. Their websites are receiving an exponential increase in visitors and are a key target for DoS attacks.

“COVID-19 provides the perfect platform for hacker email credibility, playing on an increased anxiety and curiosity about COVID-19.”

1 https://www.bbc.com/news/technology-52133349 2 https://www.cyberscoop.com/ransomware-beazley-insurance-claims/ 3 https://www.bloomberg.com/news/articles/2020-04-01/hackers-without-conscience-demand-ransom-from-health-providers

Phishing scams using COVID-19 messages A surge of COVID-19 themed phishing campaigns have been reported this year, including malicious messages purportedly sent on behalf of the Australian Government and global bodies such as the World Health Organisation. Phishing scams, sent via email or text message, claim to be providing official information on COVID-19 but are attempts to phish for personal information.

The majority of business email compromise scams and ransomware attacks are perpetrated by phishing emails. COVID-19 provides the perfect platform for hacker email credibility, playing on an increased anxiety and curiosity about COVID-19. This leads to an increase in the rate documents are opened and credentials are entered.

If a cyber-criminal obtains an employee’s credentials, they typically use them to monitor emails and commit financial and social engineering fraud. Cyber criminals also have the opportunity for lateral movement around the business’ network, potentially leading to more opportunity to steal sensitive corporate and personal information.

Key takeaways Businesses should be prepared for a new wave of cyber risks arising as a result of the COVID-19 pandemic. With increased numbers of employees working from home, the temporary closure of certain businesses and targeted COVID-19 phishing campaigns, many businesses are more vulnerable to attack than ever before.

Businesses that adapt quickly to enhancing security measures and increased employee training and awareness are likely to be better prepared against the increased attack surface that COVID-19 presents. As always, the risk can’t be eliminated completely, but cyber-attack resilience has never been more important than in 2020.

NIBA.COM.AU / 19

PROFESSIONALISM / Company culture

COMPANY CULTURE IS MORE IMPORTANT THAN EVER

A lot has changed very quickly this year, but one thing that hasn’t is the importance of maintaining a positive culture and asserting values that define your business.

B

roadly speaking, culture can be defined as ‘the way we do things around here’.

Enter COVID-19, turning our worlds upside down, how has that translated into how things are done in your workplace?

Has your culture changed? In what ways?

For the better? The worse? A bit of both?

But it has changed things: The way we work, collaborate, lead and engage with our clients. Even down to what we say, wear, do and don’t do.

So will you allow a new culture to simply emerge or will you take a more proactive approach and define the changes and what you want them to be?

Will we create culture? Or will we allow it to create us?

So if you are interested in creating culture rather than just reacting to it, here are some factors to consider:

Purpose & vision

A company purpose (or mission) is its reason for being. It is what unites us regardless of what we do - when my job is marketing and your job is finance.

A vision is a compelling picture of an organisation’s future which we should all be working towards.

In this season, has your purpose and vision had to shift, or is it rock solid the same? Does your team have a purpose and a vision? Are they united in collaborating and working towards it?

TIPS: Ensure you reinforce your company and team purpose and vision and how each person is integral to upholding and helping to achieve it.

Values & behaviours

Values represent what is important. Most

20 / INSURANCE ADVISER MAY/JUNE 2020

organisations will have articulated values and they need to be visibly displayed. A good way to display values could be with posters around the office, outlined prominently on the company website as well as in performance development plans. Values are a critical part of helping to define culture.

But more telling about an organisation’s values, are the behaviours of its people.

Do behaviours reflect these values? Or are they in contradiction, yet accepted, nonetheless?

No doubt that in our move to operating in a virtual environment, we may have seen some of these behaviours change. What is for the better? What is for the worse?

TIP: Review your values as a team and then define the expected behaviours.

Agree how you can support each other to reflect those behaviours and importantly, the steps to be taken if unacceptable behaviours are witnessed. Be proactive. Define this and regularly review as a team.

Style

You’ve heard the saying, it’s not what you wear, it’s the way that you wear it.

So is culture. Yes, it is the purpose, the vision, the values, the processes and procedures. But it is about how we do the things we do.

BY JENNY HADDAD

Principal Consultant at Spring Business Consulting

What is the appropriate style of working? And what lasting effect do you want? Is this style just for a time, or will it change things forever?

TIP: Have a discussion as a team about what you are enjoying about your culture. Find out what has helped the team collaborate better. What are you finding challenging? What is working, what’s not? How do we want to connect and collaborate?

Engaging with clients

How do you engage with clients to reflect your values and their values in an authentic way? You are going through changes and it is no secret – so are they.

How do you adapt your engagement approach in this new way of working?

TIPS: Talk to your clients about what is changing for them and their culture. Are they valuing personal connection more?

Are they strictly adhering to a professional approach? Are pets and kids joining in on meetings? Or is that strictly a no-go.

The current crisis may have turned our collective worlds upside down. But the show must go on. Our lives still need to be lived. Businesses still have a job to do. And as for company culture? Do you want to let it emerge or do you want to proactively create it?

A vision is a compelling picture of an organisation’s future which we should all be working towards.

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FEATURE / Cover story

DEFINING THE PATH TO PROFESSIONAL SUCCESS The Qualified Practising Insurance Broker (QPIB) designation is a statement of professionalism, but what does that mean? Four of broking’s brightest sparks discuss the status and its significance in unprecedented times – the certainty amid uncertainty.

BY TANAYA DAS

22 / INSURANCE ADVISER MAY/JUNE 2020

FEATURE / Cover story

CRAIG ANDERSON FROM AUSBROKERS ABS, SYDNEY

I

n 2018, Craig Anderson became a Qualified Practising Insurance Broker (QPIB). That same year, at the National Insurance Brokers Association (NIBA) Convention in Hobart, he was awarded the Warren Tickle Memorial Award for Young Professional Broker of the Year.

Upon reflecting on his achievements and success, Anderson says the importance of the right qualifications in any profession cannot be overstated. “Yes, experience is crucial, especially in insurance broking, but knowledge is the base on which you can build a successful career.”

He continues, “Being able to prove that I am qualified as an insurance broker is important to me, because I know our clients can see that the advice I provide is coming from accredited knowledge, recognised by the peak industry body.”

Anderson believe it’s his QPIB designation that proves his commitment to acting in his client’s best interest. “Building trust is about genuinely caring for my clients. Being a QPIB shows my ongoing commitment to NIBA and gives me the credibility I need when I approach clients.”

The designation has had a tremendously positive impact on Anderson’s career, he says it’s opened many doors over the past two years: “It has helped me learn the craft and understand the basics while making professionalism the highlight of my service.”

“My QPIB designation gives my clients peace of mind, it proves that I am a trusted professional committed to acting in their best interest,” he adds. A certainty that is crucial during increasingly uncertain time, says Anderson.

“Right now, it is all about communication with clients, underwriters and other industry professionals. We as a community are going through profound changes that are bound to alter the way we operate as individuals and businesses, but the work of brokers still remains the same. We have our client’s wellbeing as our top priority and we are equally invested in our communities.”

For Anderson, professionalism in this day and age is underpinned by genuine empathy combined with utmost integrity and the sense of wanting the very best for those around us. “We all are aware of the ethical expectations from us as finance professionals, but now is the time to go above and beyond to ensure that we all make it through these challenging times.”

“Being a QPIB shows my ongoing commitment to NIBA and gives me the credibility I need when I approach clients.”

NIBA.COM.AU / 23

FEATURE / Cover story

CAITLIN CARSON FROM MARSH, MELBOURNE

L

ike Anderson, Caitlin Carson’s professionalism and commitment to going above and beyond for her clients was acknowledged during the NIBA awards process. In fact, Carson succeeded Anderson as Young Professional Broker of the Year in 2019.

“Professionalism is not simply about being technically competent, but going above and beyond the ordinary,” explains Carson.

“For me, the QPIB designation represents an opportunity to show that I am qualified to the highest level of insurance broking competence, but also willing to go that extra step to develop my skills to an outstanding level.”

Carson believes education plays an important role in being viewed as a professional with integrity. She says it also has a part to play in continuing to improve the industry’s reputation.

“The importance of the level of service we provide to businesses and individuals is significant – so with this in mind, why not strive to be as qualified as possible to ensure we are capable of doing a good job.”

When Carson first started out in the industry she was excited by the opportunities that were being placed in front of her, and was eager to do whatever it took to become the best broker as quickly as possible. Although, she acknowledges now that it’s about life-long learning.

“It was a source of pride for me to collect as many qualifications as I could to prove to my employer that I was looking for a career in insurance, and was willing to do whatever it took to get there,” she reflects.

Obtaining the QPIB designation was an opportunity for Carson to demonstrate that she was ready to learn and refine her skills to the best of her ability. She says it also shows her clients that she works to a high standard.

“The QPIB designation sets brokers apart, it is recognised within the industry for representing competence and the will to strive for excellence in insurance broking. It stands for some of the most important attributes I wish to be known for.”

Carson says brokers deliver value through not only selling insurance policies, but by leveraging an incredible amount of data and resources to help provide clients with expert risk advice during times like these, to help them be well informed with respect to the challenges they may face in the future.

“This is a time where our relationships provide them with our unconditional support to keep going. This is a time where our relationships with our clients could become stronger than ever – people remember those who stick by them through their most difficult days.”

This behaviour shows integrity, says Carson, and is evidence of our desire to put our clients first. “If we do this right, in the post COVID-19 world, our clients will have a greater appreciation for our industry and a proven belief in our desire to provide them with value, professional advice, and our willingness to put their needs first.”

24 / INSURANCE ADVISER MAY/JUNE 2020

“The QPIB standard represents to me an opportunity to show that I am qualified to the highest level of insurance broking competence.”

“My QPIB designation gives my clients peace of mind that I’m a trusted professional.”

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QPIB

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Apply online at niba.com.au or email NIBA Memberships Manager Audi Witsen – awitsen@niba.com.au

D PRAC IE T F I

IN

QPIB – A STATEMENT OF PROFESSIONALISM

• QUA L

– CRAIG ANDERSON, 2018 YOUNG PROFESSIONAL BROKER OF THE YEAR

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FEATURE / Cover story

STEVEN PURSER FROM PSC INSURANCE BROKERS BRISBANE

F

or Steven Purser, professionalism is one of the most important attributes of an insurance professional and utmost professionalism is what the client base expects of the financial services industry. The 2018 Queensland Young Professional Broker of the Year says: “Having a QPIB designation is an achievement and one I can proudly relay to my clientele as proof of my abilities.”

Furthermore, Purser believe a QPIB designation can be the differentiating factor in a client’s decision to engage one’s services. He says it symbolises a broker’s level of knowledge, ability and professionalism. “Ongoing training requirements and adherence to the NIBA Code of Conduct ensures that holders of the designation are truly qualified to provide their services professionally. I believe all insurance brokers should strive to become QPIBs.” Purser says the designation has played a pivotal role in advancing his career by instilling trust in his abilities as an insurance broker. “QPIB is a reliable and well-recognised designation, which is known by all members of the insurance industry. Clients also understand the importance of such an accolade once they’re advised that it is obtained through NIBA. And for this reason, I proudly advertise my QPIB designation on all outgoing correspondence.”

Purser says it has also encouraged him to strive to further his knowledge and professionalism.

“Here in Queensland we are well versed in dealing with catastrophes and large claim events, but none of us have experienced such an economic downturn as that caused by COVID-19. The current crisis is unprecedented and we are all adapting to ensure we continue to offer the best service to our clients with understanding and empathy under these highly stressful circumstances.”

“I proudly advertise my QPIB designation on all my outgoing correspondence.”

26 / INSURANCE ADVISER MAY/JUNE 2020

Specialist Underwriter

FEATURE / Cover story

JORDYN GILBERT FROM ZENITH INSURANCE SERVICES, PERTH

“P

rofessionalism is the way in which you conduct yourself throughout your careers,” say Jordyn Gilbert, the 2019 Western Australia Young Professional Broker of the Year.

Gilbert, like Purser, Carson and Anderson is a Qualified Practicing Insurance Broker: “My QPIB designation is an acknowledgment of my professional training and expertise. To receive the designation means that I meet the required capabilities, am qualified and conduct myself in line with the expectations of NIBA,” she explains.

“I think it is important for brokers to work towards obtaining QPIB status, not only for personal development, but to ensure our industry is seen to be maintaining a high level of professionalism.”

She says clients must be able to trust brokers to provide the highest level of service and advice, and QPIB certainly helps with this.

A broker doesn’t become a QPIB overnight, in fact, it is something Gilbert had been working towards throughout the course of her careers. “Our industry allows people to continue to develop and learn during their careers and I will continue to work towards furthering my professional development and mentoring, with the support of NIBA, whilst encouraging others to do so as well.”

Not failing to acknowledge the unprecedented circumstances we find ourselves in, Gilbert says it has reaffirmed for her the importance of having good client relationships, understanding her clients’ needs, as well as having sound technical knowledge to assist.

“Our clients need trusted and professional advice to help them work through this difficult time.”

“I think it is important for brokers to work towards obtaining QPIB status, not only for personal development but also to ensure our industry maintains a high level of professionalism for the years to come.”

Become a Qualified Practising Insurance Broker

Visit niba.com.au/html/membership_forms. cfm?mtype=qpib to check the eligibility criteria and to apply online, or email NIBA Memberships Manager Audi Witsen – awitsen@niba.com.au

28 / INSURANCE ADVISER MAY/JUNE 2020

FEATURE / Cyber

TH CRIM

30 / INSURANCE ADVISER MAY/JUNE 2020

FEATURE / Cyber

HE CYBER ME VIRUS Extending adequate insurance cover to the country’s more than two million small businesses can be fraught with issues.

BY NINA HENDY

NIBA.COM.AU / 31

FEATURE / Cyber

B

rokers trying to run a profitable business can struggle with the right wording in policy documents when extending cyber cover to small businesses.

But cyber criminals see small businesses as an easy target. Those running their own small business are often pulled in so many directions that cybercrime protections come last on the list.

For cybercriminals, it’s also often quicker and easier to extort money from a small business than trying to go after a corporate giant with more rigorous cyber protections in place.

The statistics paint a grim picture.

The small business sector is the target of 43 per cent of all cybercrimes, and 22 per cent of small businesses that were breached by the 2017 Ransomware attacks were so affected that they could not continue operating, according to the Australian Small Business and Family Enterprise Ombudsman.

The statistics also reveal that cybercrime costs the Australian economy more than $1 billion annually.

That figure is only expected to rise given that cyber criminals have twisted the coronavirus pandemic to their advantage, with a significant increase in COVID-19 themed malicious cyber activity since early March this year, according to the Australian Cyber Security Centre (ACSC).

Between 10 and 26 March alone, the ACSC received more than 45 COVID-19 cybercrime and cybersecurity incident reports from businesses.

The front line

The pressure this puts on insurers to provide adequate cover is immense. Many brokers told the National Insurance Brokers Association (NIBA) that while some insurers in the market are aware of the threats, they’re not necessarily prepared for them.

The cyber threat landscape is consistently changing, and therefore the insurance industry needs to understand how the landscape is changing and respond accordingly, says National Head of Sales for

32 / INSURANCE ADVISER MAY/JUNE 2020

BETWEEN 10 AND 26 MARCH ALONE, THE ACSC RECEIVED MORE THAN 45 COVID-19 CYBERCRIME AND CYBERSECURITY INCIDENT REPORTS FROM BUSINESSES. Emergence Insurance, Gerry Power.

He explains that cyberattack will impact a business in a number of ways, including: • The cost of removing the threat actor from the business systems • The loss of profits suffered when clients lose confidence in their ability to protect their personal information or intellectual property • The cost of defending a legal action due to the failure of the business to keep information confidential • The cost of notifying the Office of the Australian Information Commissioner and affected customers “When you need to respond to a cyber event, businesses want all aspects of the cyber event to be covered. Cyber bolt-ons tend to provide limited cyber cover for a small premium. It’s like buying a car with two wheels. Yes, it’s a car, but it doesn’t get you where you want to go,” Power says.

“As cyber insurance specialists, we get it. That’s why we recently released our

fourth cyber policy upgrade in four years.

“It’s critical for the insurance industry to review cyber coverage and to be ahead of the curve to ensure client’s cyber policies reflect the trends that we’re seeing in other parts of the world, and to adjust our protection before it becomes a serious threat to Australian business,” Power says.

NOVA Underwriting Development Manager Rob Collyer says the opportunity for brokers to sell cyber cover to the SME market has never been so great.

The last few years has seen a marked increase in both interest and take-up rate of cyber policies.

“The past couple of years has seen greater interest from the SME segment for protection in this area, and the (COVID-19 pandemic), which has led to the need for employees to work from home has further highlighted the need for SMEs to have strong cyber security measures in place together with appropriate insurance protection,” Collyer says.

CASE STUDY: A TYPICAL CYBER CLAIM An IT company that provides ATM processing services moved its data backup to an outside data storage facility.

During the process, an employee of the insured made an error, which resulted in individuals being allowed to withdraw money from ATMs regardless of their bank balances.

The entity that owned the ATMs sued SOURCE: LONDON AUSTRALIA UNDERWRITING

the insured to recover the losses.

The employee error constituted a negligent act, error or omission in the performance of technology professional services, and the policy provided legal costs and indemnification for the insured.

Approximately $250,000 was paid out in damages, and $20,000 in legal fees.

Smarter cyb r insurance for your business. _ Emergence is your award-winning underwriting agency solely focused on providing flexible, innovative insurance solutions to help protect businesses against cyber risks. Be at your best with Emergence.

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FEATURE / Cyber

“WHEN YOU NEED TO RESPOND TO A CYBER EVENT, BUSINESSES WANT ALL ASPECTS OF THE CYBER EVENT TO BE COVERED. CYBER BOLT-ONS TEND TO PROVIDE LIMITED CYBER COVER FOR A SMALL PREMIUM. IT’S LIKE BUYING A CAR WITH TWO WHEELS. YES, IT’S A CAR, BUT IT DOESN’T GET YOU WHERE YOU WANT TO GO,” POWER SAYS. Writing a good policy

Above Gerry Power, Emergence Insurance

5 key trends that brokers should keep their eye on: 1. Benefits of integrated systems: If current processes require double keying of data, now is the perfect time to invest in integrating your systems.

2. More use of centralised systems: An insurance system, like ibais or your CRM are much better solutions now that remote working is the norm. ibais will even

34 / INSURANCE ADVISER MAY/JUNE 2020

A good policy for SMEs should include three major components, according to Theresa Lewin, the Financial Institutions Leader for Australasia for Willis Towers Watson. These include: • Incident response costs and crisis management • Damages to third parties and fines and penalties • Network or business interruption In the current COVID-19 environment, insureds should ensure loss of profit is covered if the information systems experience a system failure because the administrators of the systems aren’t present, or the remote access system doesn’t allow

time and user stamp information to support the compliance and auditing process.

3. Embracing communication: Brokers will need to embrace multiple technologies going forward to make it even more important to ensure effective record keeping processes for both office and home workers.

4. Accessing information from multiple devices: Using multiple devices to view company

them to update or patch them, Lewin advises.

“We’re starting to experience increases in the reporting of cyber notifications and claims, particularly as a result of social engineering and phishing attacks harvesting passwords or deploying malware. We also expect to see losses as a result of IT system/ supply chain failure due to an increased load on IT infrastructure, heightened risk of errors and reduced mitigation.

Emergence CEO and founder Troy Filipcevic cautioned brokers against boltons to cover cyber. “This sets the broker up to have a difficult conversation with their client. I’d caution anyone providing diluted cover and would always look to standalone cyber cover for clients,” Filipcevic says.

information and access insurance systems is going to become the norm. Management ability to control access by user on all devices to different levels of information will be important.

5. Increase need for data security: Strong anti-malware and virus protection and back-ups will become more important as more people use the same devices for work and social connections.

SOURCE: JIM ARMSTRONG, DIRECTOR, BAIS.

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FEATURE / Construction

36 / INSURANCE ADVISER MAY/JUNE 2020

FEATURE / Construction

CONSTRUCTION IN THE COVID ERA: CHALLENGES GALORE The construction insurance sector’s faced significant challenges over recent years. Throw in COVID-19, and there’s something of a perfect storm.

BY MARTIN WANLESS

NIBA.COM.AU / 37

FEATURE / Construction

I

nsurers’ retreat from construction was already notable before COVID-19, with some deciding either construction insurance specifically, or Australia in general, wasn’t for them.

“There’s been considerable market contraction since Q3 2018,” says Alister Burley, Aon’s National Practice Leader – Construction.

“It’s come on the back of increased claims activity, major natural catastrophes and soft market conditions causing unprofitability.”

And that was before COVID-19 hit, causing other issues.

“There’s around $4.6bn of rebuilding and repair work underway following storms and fires,” says Karl Sullivan, Head of Risk & Operations at the Insurance Council of Australia.

“Most states are considering construction essential and, providing they’re sticking to the guidelines about working safely, work is continuing.”

It is continuing, albeit differently. And that brings new challenges.

Continuing the day-to-day

Rifhat Jangir worked in insurance and underwriting for 20 years before joining insurance builder Advanced Buildings.

“We’ve put measures in place to help us continue to work safely,” she says.

“We’ve enforced what the World Health Organisation and government is advising in relation to PPE gloves and masks.

“We’ve got face shields for our field staff, and our trades are following suit where necessary. We’re doing one trade in, one trade out, and we’re ensuring everyone’s social distancing.”

Jangir believes insurers could face a backlog, with claims being lodged but customers reluctant to give access to their properties.

“It’s crucial to attend a site to assess what’s needed. The risk is that claims will

be lodged, but as a notification only. This may cause a surge in work and or delays in getting the work completed. Insurers may also have to cash settle more claims.”

Glen Warwick, Partner in the Projects and Construction team at law firm Clyde & Co, says some companies have also introduced temperature screening, curtailing or postponing non-essential travel and working from home.

“THE MARKETS ARE REQUESTING MORE INFORMATION AROUND HOW PROJECTS ARE DEALING WITH COVID-19 AS THIS BECOMES EMBEDDED IN THEIR UNDERWRITING CRITERIA. SOME OF THE COVID-19 BASED EXCLUSIONS ARE FAR-REACHING.” - ALISTER BURLEY, AON

Helping clients COVID proof TIPS FOR BROKERS FROM ROB MCNAB, MANAGER – CONSTRUCTION AT BERKSHIRE HATHAWAY SPECIALTY INSURANCE Provide a detailed representation of how the contractor / project has considered COVID-19, including: • Measures they are taking above and beyond standard government requirements for social distancing.

• Details on how their schedules / programmes may consider the impacts of COVID-19 (both in terms of labour productivity and also procurement of items of materials, particularly from overseas).

• A financial representation of the contractor’s financial viability / stability.

Be prepared with the sort of questions insurers are likely to ask when there is a cessation, such as: • The status of the works – what has been completed and what is remaining?

• Details on how the worksite has been left.

• When are the works likely to recommence?

• How has the site been physically secured?

• Do services remain connected to the site?

38 / INSURANCE ADVISER MAY/JUNE 2020

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FEATURE / Construction

“In the event of a positive test, the priority is on ensuring appropriate isolation and testing of staff and cleaning the worksite,” he says. “All organisations have statutory duties to ensure the health and safety of their workers, so far as practicable.

“However, as to the impact on project risks, parties will need to consider their contractual rights carefully as to where ultimate liability for the disruption sits.”

The COVID effect

Rob McNab, Manager – Construction at Berkshire Hathaway Specialty Insurance, says some projects will slow, while others stop.

“The primary impact of social distancing is delays to schedules,” he says. “Most schedules are optimistic, with minimal contingencies built in and, as such, will not consider a slowdown in productivity like this.

“A lot of extensions to single project policies will be required.

“Delays could lead to liquidated damages payable by the contractor, and while most larger contracts will likely have force majeure provisions that could enable the contractor to apply for an extension of time, smaller contracts may not.

“The economic climate means construction starts are down, which will put contractors under pressure. A number are heavily reliant on immediate cash flow, and financially-stressed contractors can present a greater risk to insurers because corners can get cut.”

Tom Webb, Partner in the Projects and Construction team at Clyde & Co, says virtually every construction project will be affected, in terms of either increased costs or delays, or both.

“All parties involved should look carefully at their contractual rights, such as force majeure and change in law clauses.

“In many cases, either temporary or permanent negotiated outcomes will be reached. There is little appetite for costly disputes. However, it is likely that there will be claims arising out of those projects that have been affected, or where contractual entitlements are unclear.”

All systems… stop?

IF A PROJECT HAS GROUND TO A HALT, IT’S IMPORTANT TO TAKE THE RIGHT STEPS. Insureds need to inform their insurer they have an unoccupied construction site and advise of the precaution they are taking to reduce and mitigate risk, says Alister Burley.

Considerations include: • Removal of all non-essential machinery, equipment and tools from the site.

• Improved site security measures.

• Removal of hazardous materials from the site or stored in a secure area in accordance with local code requirements.

• Insureds should implement risk control measures to address their specific risks.

Burley says he’s receiving feedback that the cost to operate is significantly increased, and there will be delays in delivering projects within pre-COVID timeframes.

He also has concerns over some exclusions being applied by insurers.

“The markets are requesting more information around how projects are dealing with COVID-19 as this becomes embedded in their underwriting criteria.

Some of the COVID-19 based exclusions are

“THERE’S A DANGER OF PEOPLE THINKING THEY MIGHT FOREGO INSURANCE NOW AND PICK IT UP AGAIN NEXT YEAR. IN BETWEEN NOW AND NEXT YEAR SOMETHING TERRIBLE COULD HAPPEN.” – KARL SULLIVAN, INSURANCE COUNCIL OF AUSTRALIA 40 / INSURANCE ADVISER MAY/JUNE 2020

far-reaching.

“We have concerns about how far some of these exclusions apply, particularly when they include the words ‘directly or indirectly relating to COVID-19’. “‘Indirectly’ can have consequences that were never envisaged. If a project was shut down for a period because of a COVID outbreak and was subsequently impacted by a storm, could insurers reduce their liability to the damage from the storm?”

Another challenge for brokers, Sullivan believes, is that some businesses could view insurance as a luxury.

“There’s a danger of people thinking they might forego insurance now and pick it up again next year. In between now and next year something terrible could happen.

“We’re certainly not immune to another event occurring.”

FEATURE / Leadership

Leading with emotional intelligence defines workplace resilience The current crisis and its collective psychological impact has meant that we are reconsidering the values we stand for and are looking to our leaders to do things differently going forward.

Two trailblazers spoke to Insurance Adviser and shared their views and insights on workplace resilience.

INTERVIEW BY TANAYA DAS

42 / INSURANCE ADVISER MAY/JUNE 2020

FEATURE / Leadership

R

apid disruptions are something we are all prepared for on some level, especially in the insurance industry, but the current situation is not something many could have envisaged.

There are people who believe this is the time for effective leadership to shine. The current circumstances need leaders to be agile, resilient and take decisions grounded in intellectual and emotional intelligence.

Dr Kirstin Ferguson, one of Australia’s leading company directors, author and awardwinning expert on leadership believes that developing mental resilience in life and at work is incredibly important. Everyone will face challenges and rather than falling victim to these setbacks, someone who is resilient will find ways to bounce back more quickly and to look for opportunities in the gloom.

“Everyone in our teams are struggling to some extent; whether that is adapting to working from home, having to balance teaching children at home while also working,

flood, hailstorm and now a pandemic.

Communities already reeling from natural catastrophes are now doing their best to survive an unseen threat that has held the whole world hostage.

According to Leney this predicament has impacted people across the globe and so far the response in Australia, across all quarters, has been impressive, “It’s proven that we as a nation have the intellectual bandwidth and gumption to deal with a crisis of this magnitude. We as insurance professionals can help alleviate some of the uncertainty by being authentic and communicating effectively.”

Knowing when to ask for help is key

Dr Ferguson believes that everyone has the capacity to build their own personal resilience to challenging events as they arise. She says, “People who are resilient are often emotionally intelligent, having this particular advantage provides the self-

“As leaders we will need to be open minded about what the future of work will look like and not be too wedded to the way things were prior to this pandemic.” – Scott Leney, Marsh or perhaps the fear of losing their jobs. Leaders need to be in tune with the needs of each of the people they lead to be able to meet their individual needs through this crisis.”

Marsh Australia CEO, Scott Leney believes that we need behaviours that are rooted in empathy and harness the power of the human connection, to get through crises.

He says, “Right now it’s about being there for our clients, for our colleagues and for the wider community. We need to be less rigid and operate in a way that is flexible and accommodating and definitely not too narrowly defined.”

“I think of the possibilities of the post COVID-19 world, the productivity we could gain, the energy we could save, the reduced carbon footprint from people not being constantly on the move and the deeper personal connections we could cultivate by having the time to invest in relationships.”

Australia – From catastrophes to coronavirus

The past few months have been extremely tiring for many individuals and businesses in Australia, with the drought, bushfire,

awareness to understand if one is responding to crises in a helpful way and also ask for help when one is depleted.”

“Being emotionally intelligent allows us to show empathy for those we lead and to help them build resilience as well,” she says.

We’re all facing uncertainty with the current situation and Leney says, “Clients depend on insurance brokers to be around, and they need risk professionals the most when times are tough. These are the very times where our own resilience is likely to be tested and we may need to reach out for support.”

“Insurance intermediaries play an important role in helping people and businesses understand risk, obtain protection and invest to grow with confidence. But we also carry a responsibility to keep trading to ensure ongoing employment for the many people who choose to work in our organisations.”

Normal needs to be redefined

Leney says, “Looking forward, as leaders we will need to be open minded about what the future of work will look like and not be too wedded to the way things were prior to this pandemic.”

According to Dr Ferguson what we can learn from this crisis is that those leaders who calmly lead their teams in a way that balances a sureness of success with a realistic assessment of the brutal facts of our collective experience.

She says, “I think this crisis will forever change the way we work, whether that is our ability to rapidly work from home in the future or some roles that may never go back into the office.”

“I think organisations will also be looking at innovative ways to continue to use technology to reduce reliance on travel and face-to-face events to learn and network.”

Leney agrees with this assessment, “There will be a seismic shift in how we look at flexible working, having proof now of the ability to work remotely during this time of crisis. There will be a lot of thought put into things that we have perhaps taken for granted in the past.”

“Why do we need to have all these people jammed into trains and buses like sardines, so they can occupy our vast buildings and be away from their families for most of their waking hours?”

“There may also be a shift in attitude and expectations among our workforce.

The current changed family dynamics may result in a different attitude toward frequent business travel and time away from home.

The role of working parents in the lives of their dependent children, all of these things may create new ways of working based on what we have learned during this time, and my guess is there will be a quantum shift in workplace flexibility.”

“And above all, this crisis has proven that there are no actual barriers in corporate workspace and that differently abled talent can be an integral part of our workforce.

Right now, all of us have the capacity to change our world for the better and make it more inclusive in ways that were unimaginable before.”

“Right now we need leaders who are decisive and courageous with a massive dose of transparency, empathy and emotional intelligence.”

– Dr Kirstin Ferguson NIBA.COM.AU / 43

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PRESENTS

YOUR GUIDE TO GOVERNMENT STIMULUS, INDUSTRY RELIEF MEASURES AND MORE

COVID-19 / Welcome

C

VID-19

COVID-19 AND NIBA DALLAS BOOTH

Chief Executive Officer, National Insurance Brokers Association

S

ince the start of the COVID-19 challenges, NIBA has taken a number of steps to protect our staff, help our members and continue our key role of representing member interests to governments, regulators and other stakeholders.

NIBA has remained open and in business, but we are doing so remotely. We want to minimise risks to our staff, and have made arrangements for our tasks and activities to be continued while working from home.

Sadly, some of our key activities have had to be postponed, in some cases for 12 months. We will not be holding our gala lunches this year, and we are delighted that we have been able to move our bookings to 2021 without any financial or other penalties. We are very grateful for the support and flexibility we have received from our venue hosts in this regard.

We are really saddened that the annual NIBA Convention can’t go ahead as planned but we are working furiously to bring a virtual conference to you.

In the meantime, we are looking at a number of ideas about how we might help brokers learn, grow and develop their technical and personal skills during the remainder of 2020. Watch this space.

At the same time, our core role of representing the interests of members continues unabated.

We have had recent contact with a number of Federal and State government agencies, and we continue to provide information to Federal Treasury and ASIC on the state of the insurance markets and the challenges faced by brokers seeking to act in the best interests of their clients.

Importantly, we have made it very clear to the Federal Government that now is not the time to expect insurance brokers to start thinking about how to implement new processes and procedures associated with reforms coming out of the Royal Commission and elsewhere. There are very significant challenges facing insurance brokers and their clients, with almost everyone operating outside their normal working environments. We do want the Government to defer major reforms until brokers are better placed to implement the reforms.

We welcome the comments by the Prime Minister who has indicated the important need for business to lead the economic recovery that Australia will need once the health challenges are dealt with. NIBA is considering whether changes are needed to the legal and regulatory environments to facilitate better operation of the insurance markets in Australia, and to help insurance play its proper role in protecting the interests and assets of Australians and their businesses.

46 / INSURANCE ADVISER MAY/JUNE 2020

NIBA has also been participating in the Insurance Council of Australia’s Pandemic Taskforce, where information about the insurance industry’s responses to the COVID-19 challenges are discussed. It has been pleasing to see the level of cooperation and understanding that has developed as a result of those discussions.

So, despite the challenges, and the uncertainties we all now face, our core commitments to Representation, Professionalism and Community continue. We remain the One Voice for insurance brokers in Australia, and we remain very grateful for the support we receive from our members in doing so.

Our core commitments to Representation, Professionalism and Community continue.

We remain the One Voice for insurance brokers in Australia, and we remain very grateful for the support we receive from our members in doing so.

CONTENTS COVID-19 PULLOUT 47 NIBA President Eric Harris on COVID-19 and Insurance Markets 48 Government Support for Businesses amid COVID-19 54 Relief Proposals from Insurers – what does it mean for brokers?

55 Legal and Regulatory Considerations for Insurance Brokers 56 AFCA’s Response to COVID-19

COVID-19 / Insurance markets

C

VID-19

COVID-19 AND INSURANCE MARKETS ERIC HARRIS

President, National Insurance Brokers Association

T

wo words keep being used in relation to the situation we are now in: unprecedented, and uncertain.

There is broad agreement that the current environment is unprecedented, brought about by a pandemic that has caused thousands of deaths around the globe followed by government directed closure of much economic activity.

Because the outcome of the health situation is largely unknown at the present time, the short-term prospects for people, businesses and the economy are very difficult to predict. Hence the high level of uncertainty being expressed by nearly all commentators, especially the economists. I fear the impact on our economy will be significant for some time.

In the midst of all these challenges, we are starting to see possible impacts on the insurance markets.

The initial comment is that it appears most of the March 2020 business and renewals were “business as usual”, with not a lot of COVID-19 impact being observed. That may well have been the calm before the storm.

The other thing we know is the fact that underwriters are continuing to manage their risk exposure and their pricing. The challenges faced by brokers in arranging appropriate cover at a reasonable price remain.

So what does all of this mean for insurance brokers over the next three to six months?

First and foremost, the client has to be the priority. While there are preliminary discussions about easing the restrictions on trading and on people associating together, there is no doubt that a large number of businesses have been severely impacted by the steps taken to prevent the spread of the virus.

Brokers will therefore have to spend considerable time understanding the financial and trading position of their clients, and reviewing their risk and insurance needs immediately and for the next 12 months. For some, their position will remain extremely challenging. For others, there will be some hope of recovery in the not too distant future.

All clients will need to have their position carefully reviewed.

Clients are reviewing with their brokers now, mid term, as well as during the renewal process.

A number of insurers have announced proposals to assist clients affected by the slow down in the economy.

Brokers will need to work with their clients to ascertain whether these proposals would be of assistance, bearing in mind to consider the best interests of the client at all times.

The second thing to consider is the financial and trading position of the broking firm. No doubt Member Principals have been doing this for the past month in any event. A careful review of costs and expenses, liabilities, and projected revenue over the next three, six and 12 months must be undertaken.

Don’t forget the wide range of assistance programs now available from the Federal, State and Territory Governments, which have been summarised in the following pages of this supplement. I urge you to make use of all relevant programs appropriate to your business.

Finally, there is widespread consensus that things will be different “on the other side”. Some businesses will fail, others will continue to struggle even after restrictions have been lifted, and others will be subject to ongoing restrictions for some time to come.

There will be changes to what work is undertaken, how it is done, where it is done, and what technology is used. No one would have expected large numbers of people would simply transfer their place of work from the office to home, as successfully as we have been able to do in the past six weeks.

Therefore, now is the time to be thinking about 2021, 2022 and beyond. What will the client profile look like in 12 months time, what opportunities will present themselves, and what has to happen to the broking firm’s business operations to make the best use of opportunities that are likely to arise?

I have great faith in the professionalism of insurance brokers across Australia, in their commitment to acting in the best interests of their clients, and responding to the challenges to ensure their businesses survive, and thrive in the new economic environments we will all be soon facing.

The NIBA Board of Directors will be continuing to monitor developments very closely, and we will continue to discuss how best we can support our members in these challenging times. The Board is also open to suggestions as to what might be done by your Association to help and support brokers.

Please do not hesitate to contact me or our CEO, Dallas Booth, with any ideas you would like the Board to consider.

NIBA.COM.AU / 47

COVID-19 / Government support

GOVERNMENT SUPPORT FOR BUSINESSES AMID COVID-19 WHO

WHAT

Assistance to help retain apprentices and trainees

Small businesses (fewer than 20 full-time employees) who retain an apprentice or trainee, or employers and group training organisations that reengage an eligible out of trade apprentice or trainee

Eligible employers can apply for a wage subsidy of 50 per cent of the apprentice’s or trainee’s wage paid during the nine months from 1 January 2020 to 30 September 2020.

Backing business investment (BBI)

Business with an aggregated turnover of less than $500 million for the 2019-20 and 2020-21 income years

BBI provides an incentive for eligible entities to deduct the cost of depreciating assets at an accelerated rate.

Boosting cashflow for employers

Small or medium sized business entities, including not-for-profits, with aggregated annual turnover under $50 million

This initiative provides temporary cash flow support to eligible entities that employ staff during the economic downturn associated with COVID-19.

Increased instant asset write-off

Businesses with an annual aggregated turnover of less than $500 million (up from $50 million)

The threshold for instant asset write off for eligible entities has been increased from $30,000 to $150,000.

SME guarantee scheme

Small and medium enterprises (SMEs)

This scheme provides access to working capital.

Rent relief code of conduct

Small-medium sized businesses with annual turnover of up to $50 million, who have been affected by the COVID-19 pandemic

The federal and state governments will implement a set of good faith leasing principles for application to commercial tenancies between owners/operators/other landlords and tenants.

Jobkeeper wage subsidies

Businesses with a turnover of less than $1 billion that has reduced by more than 30 per cent; or businesses with turnover of $1 billion or more that has reduced by more than 50 per cent; and the business is not subject to the Major Bank Levy

Under the JobKeeper Payment, businesses impacted by the Coronavirus will be able to access a subsidy from the Government to assist in paying employee wages.

FEDERAL

48 / INSURANCE ADVISER MAY/JUNE 2020

C

VID-19

NIBA Policy Research Analyst, Allyssa Hextell, provides a helpful guide to the federal and state initiatives supporting small and medium businesses during these uncertain times.

There have been a flurry of announcements, unveilings and media statements released in the past few weeks. With so much information to filter through, it can be

hard to keep up. NIBA is committed to supporting our members through the coronavirus outbreak and the uncharted territory that lies on the other side.

Hereâ&#x20AC;&#x2122;s a breakdown of the various stimulus packages and what they potentially mean for you or your clients.

HOW

WHEN

WHERE

Employers can register for the subsidy now visit the referenced website.

Final claims for payment must be lodged by 31 December 2020.

treasury.gov.au/sites/default/ files/2020-04/fact_sheet-supporting_ apprentices_and_trainees_0.pdf

To be eligible to apply the accelerated rate of deduction, the asset must not be an asset to which an entity has applied depreciation deductions or the instant asset write-off rules.

The depreciating asset must be held on or after 12 March 2020, and first used or first installed ready for use for a taxable purpose on or after 12 March 2020 until 30 June 2021.

ato.gov.au/business/depreciation-andcapital-expenses-and-allowances/backingbusiness-investment---accelerateddepreciation/

The Australian Taxation Office will provide tax-free cash flow boosts of between $20,000 and $100,000, delivered through credits in the activity statement system.

The payment became available on 28 April 2020.

ato.gov.au/business/business-activitystatements-(bas)/in-detail/boosting-cashflow-for-employers/

Instant asset write-off can be used for both new and second-hand assets. Some exclusions and limits apply.

The threshold will apply to assets that are either ato.gov.au/business/depreciation-andinstalled or ready for first use by 30 June 2020. capital-expenses-and-allowances/simplerdepreciation-for-small-business/instantasset-write-off/

The Government will guarantee 50 per cent of new loans issued by eligible lenders to SMEs, with the scheme able to support $40 billion of lending.

The scheme will be available until 30 September 2020.

treasury.gov.au/coronavirus/smeguarantee-scheme

How this code is regulated will be determined by the state governments.

The National Cabinet Mandatory Code of Conduct for commercial leasing was released by the Prime Minister on 7 April 2020.

business.gov.au/risk-management/ emergency-management/coronavirusinformation-and-support-for-business/ relief-for-commercial-tenancies

Affected employers will be able to claim a fortnightly payment of $1,500 per eligible employee for a maximum period of six months.

The first payments by the ATO will be received by employers from the first week of May.

treasury.gov.au/coronavirus/jobkeeper

NIBA.COM.AU / 49

COVID-19 / Government support

WHO

WHAT

AUSTRALIAN CAPITAL TERRITORY Payroll tax deferral

ACT businesses with group Australia-wide payroll of less than $10 million

Eligible businesses can apply to defer their 2020-21 payroll tax, interest free until 1 July 2022.

Payroll tax waiver

Businesses whose total grouped Australian wages for the 2019/20 financial year are less than $10 million

Eligible businesses who lodge and pay annually will have their tax liability reduced by 25 per cent, while those who lodge monthly will not be required to pay for the remainder of the 2019-20 financial year.

Payroll tax deferral

Businesses with payrolls over $10 million

Businesses will be able to defer their payroll tax payments for six months. Businesses with payrolls of $10 million or less will also receive a three month deferral in addition to the three month waiver.

Northern Territory (NT) enterprises that hold valid Australian business numbers (ABNs) and operate in the NT, have a significant permanent presence in the NT and employ NT residents â&#x20AC;&#x201C; this can be you if you are a sole trader.

Under the scheme, $10,000 grants will be made available for businesses to purchase goods and services to make permanent physical improvements to their premises.

Payroll tax relief

The Tasmanian Government will extend previously announced payroll tax waivers for the hospitality, tourism and seafood sectors, to other Tasmanian businesses with payrolls less than $5 million who have been impacted by coronavirus.

These measures will ensure that affected businesses will not pay payroll tax for the 2019-20 financial year.

Registration freeze for business vehicles

Small businesses looking to suspend activity due to the COVID-19 business downturn and trading restrictions

Eligible businesses can apply to the Registrar of Motor Vehicles to freeze their business vehicle registrations for both light and heavy vehicles.

Small business hardship grants

Small businesses, employing fewer than 50 fulltime equivalent staff, who have been impacted by coronavirus

The Tasmanian Government is providing grants of $15,000.

NEW SOUTH WALES

NORTHERN TERRITORY Business improvement scheme

If business owners can also contribute $10,000 in capital, the NT government will provide an additional $10,000.

TASMANIA

50 / INSURANCE ADVISER MAY/JUNE 2020

C

VID-19

HOW

WHEN

WHERE

Businesses will need to complete an online application form to confirm their eligibility.

They will still be required to complete their payroll tax returns as normal but will not be required to make the associated payment at the usual time.

If the deferred amount is paid prior to 1 July 2022, no interest will be charged.

Interest will be applied to any outstanding deferred amounts from 1â&#x20AC;ŻJulyâ&#x20AC;Ż2022.

covid19.act.gov.au/economic-support/ economic-survival-package/supportinglocal-businesses-and-the-economy

If your total grouped Australian wages are no more than $10 million for the 2019/20 financial year, the discount will be automatically applied to your tax liability when you lodge your Annual Reconciliation.

The Annual Reconciliation is due on 28 July 2020.

revenue.nsw.gov.au/news-media-releases/ covid-19-tax-relief-measures/covid-19coronavirus-and-payroll-tax

More information on the deferral arrangement is coming â&#x20AC;&#x201C; check the referenced website for updates.

These businesses will not need to make their payment for the March period, normally due on 7 April 2020.

revenue.nsw.gov.au/news-media-releases/ covid-19-tax-relief-measures/covid-19coronavirus-and-payroll-tax

Determine the job you want done, check the list of registered service providers, request a quote from a provider on the list, and apply online. Pay for the work using the unique voucher you receive upon application approval.

The scheme opened on 13 April 2020 and will close at 12:00 AM EST on 31 October 2020.

business.gov.au/grants-and-programs/ business-improvement-grant-nt

This measure will be delivered through a combination of payroll tax refunds and waivers.

coronavirus.tas.gov.au/stimulus-andsupport

Registrations can be reactivated at no cost when the business restarts. Visit the referenced website to lodge an application.

The maximum period that a registration can be frozen is 12 months.

coronavirus.tas.gov.au/stimulus-andsupport/businesses-and-industries/ business-vehicle-registration-reliefpackage

Businesses will need to meet the hardship test and be able to demonstrate an ability to continue to operate in the current environment and provide products and services necessary for the Tasmanian or Australian community, or may need to temporarily cease operation but can demonstrate strong prospects for future jobs sustainment or growth.

Details of the grants will be announced on the referenced website, in due course, along with the application process.

business.gov.au/Grants-and-Programs/ Small-Business-Hardship-Grant-TAS

NIBA.COM.AU / 51

COVID-19 / Government support

WHO

WHAT

Employers who pays more than $6.5 million in Australian taxable wages and have been negatively affected (directly or indirectly) by the COVID-19 pandemic

Eligible businesses can apply for a deferral of payroll tax for the 2020 calendar year. If you have already applied for a deferral, you do not need to reapply – it will be extended.

Deferral of land tax

Businesses and individuals paying land tax quarterly in 2019-20

Eligible businesses will be able to defer payment of their third and fourth quarter instalments for up to six months.

Emergency cash grants for small businesses

Small businesses and not-for-profit entities that employ South Australians who have been highly impacted by the COVID-19 pandemic

Eligible entities will receive a $10,000 grant to support the operation of their business.

Payroll tax waiver

Businesses with annual wages of less than $4 million

Eligible businesses will receive a six month payroll tax waiver, and will be notified by RevenueSA through RevenueSA online.

Payroll tax deferral

Businesses with annual Australian grouped wages above $4 million that can demonstrate they have been significantly impacted by COVID-19

Eligible businesses will, upon application, be able to defer payroll tax payments for the six months from April to September 2020.

Business support fund

Small businesses that have been highly impacted by shutdown restrictions

Eligible businesses can now apply for a one-off $10,000 grant from the Victorian Government's Business Support Fund.

Land tax relief

Commercial and residential landlords who provide tenants, impacted by COVID-19, with rent relief.

This relief is also available to land owners who are unable to secure a tenant because of COVID-19.

NB: For commercial landlords to be eligible, the property must be rented to a tenant with an annual turnover of up to $50 million, and the tenant must be eligible for the Commonwealth Government’s JobKeeper Payment.

Those eligible will receive a 25 per cent reduction on their property’s 2020 land tax.

These landlords can also defer the remainder of their 2020 land tax to 31 March 2021.

Payroll tax refunds and deferral

Businesses with annual taxable wages of up to $3 million

Eligible entities will receive a full refund of payroll tax for the 2019-2020 financial year.

Small business may also apply to defer payroll tax payments for the first quarter of the 2020-21 financial year.

Payroll tax deferral

Businesses with annual wages of $5 million or more at 29 February 2020, or new employers from 1 March

Eligible entities will be able to apply to defer lodging and paying returns.

Payroll tax waiver

Small-to-medium sized businesses with annual wages of less than $7.5 million at 30 June 2020

Eligible entities will have payroll taxes waived until the end of the financial year.

QUEENSLAND Payroll tax deferral

SOUTH AUSTRALIA

VICTORIA

WESTERN AUSTRALIA

52 / INSURANCE ADVISER MAY/JUNE 2020

C

VID-19

HOW

WHEN

WHERE

In order to take advantage of these measures business must apply online.

Once your application has been processed, you wonâ&#x20AC;&#x2122;t need to pay payroll tax returns for the 2020 calendar year.

business.qld.gov.au/running-business/ employing/payroll-tax/lodging/ coronavirus-tax-relief

Businesses and individuals will be sent their land tax notices of assessment as usual, with information provided on how the deferral will be administered.

revenuesa.sa.gov.au/taxes-and-duties/ land-tax/covid-19-relief

The grant is being funded from the State Governmentâ&#x20AC;&#x2122;s $650 million Jobs Rescue Package.

Applications for the grant will open shortly and be available until 1 June 2020.

treasury.sa.gov.au/growing-south-australia/ stimulus-measures-to-support-businessesand-the-community-impacted-by-covid-19

Monthly payroll tax returns must still be lodged to capture wages for the month, with no payment to be made.

For these eligible business groups, payroll tax revenuesa.sa.gov.au/taxes-and-duties/ payments that were due to be paid from April to payroll-tax/covid-19-relief September will now be due from October 2020.

Businesses will need to complete the Applications for waiver or deferral of payroll tax (COVID-19) form.

For those eligible businesses, payroll tax revenuesa.sa.gov.au/taxes-and-duties/ payments that were due to be paid from April to payroll-tax/covid-19-relief September will now be due in October 2020.

Small businesses can apply online at the referenced website.

Applications are open until 1 June 2020.

business.vic.gov.au/support-for-yourbusiness/grants-and-assistance/businesssupport-fund

Instructions on applying for this reduction will be published on the referenced website in the coming weeks.

Emergency legislation was put to the Victorian Parliament on Thursday 23 April to reform residential and commercial tenancy laws.

sro.vic.gov.au/coronavirus

Eligible business must continue to lodge returns but do not need to make further payments for the 2019-20 financial year.

Eligible businesses will be contacted by the State Revenue Office in relation to the reimbursement of paid payroll tax.

The government began making reimbursements from 27 March 2020.

sro.vic.gov.au/coronavirus

Your approval advice will include instructions for completing annual reconciliation.

If your application is approved, your due date for lodgement and payment will be extended to 21 July 2020.

wa.gov.au/government/multi-step-guides/ payroll-tax-employer-guide/covid-19-reliefpayroll-tax-employer-guide

Employers must retain evidence of their Australian taxable wages at 29 February 2020 showing their entitlement to claim the waiver, but do not need to apply.

Your payroll tax for March to June will automatically be waived.

wa.gov.au/government/multi-step-guides/ payroll-tax-employer-guide/covid-19-reliefpayroll-tax-employer-guide

NIBA.COM.AU / 53

COVID-19 / Gold Seal

C

VID-19

RELIEF PROPOSALS FROM INSURERS – WHAT DOES IT MEAN FOR BROKERS? As clients begin to cancel policies, insurance brokers can play a crucial role.

By Sheila Baker, Managing Director and David Mills, Director Market Development - Gold Seal

I

n March, the IAG Group, including CGU, announced initiatives to assist SME businesses experiencing difficulties due to the prevailing economic conditions. The following week, the Australian Competition and Consumer Commission (ACCC) granted Suncorp, QBE and Allianz interim authorisation to work together on a relief package.

The proposals set out the opportunity for small businesses to defer payment of their annual or monthly premiums for six months.

The measures are designed to support businesses through the COVID-19 crisis, but the proposals and their potential impact have raised concerns amongst brokers.

The feedback received is that clients are contemplating cancelling their insurance policies. Furthermore, many brokers are concerned that the clients that seek to obtain a six-month deferral, will merely result in clients deferring their decision to cancel their insurance policies and simply take out a new policy, if required.

It is important for brokers to note and to explain to clients that they are still responsible for paying their insurance

54 / INSURANCE ADVISER MAY/JUNE 2020

premiums, and that under these circumstances the premiums are deferred, not forgiven. As Dallas Booth noted in a recent column published on the Insurance and Risk website, the real question is: “what is best for the client?”

In order to determine this, clear communication with the client will be key.

Brokers must also consider and understand the clients’ business plans and projections – such as - are they still trading? What are their plans and projections for the coming months?

Do they intend to prepare to return to normal trading when the restrictions are lifted?

It may serve brokers well to compile a checklist of questions and matters they need to discuss with clients and work through them methodically, a little like a needs analysis tool. Whilst each client will have individual circumstances, there are other options available to your clients that you can explore.

Some of these are: • Payment of the full premium on renewal • The usual premium funding arrangements • Payment of the premium six months after the renewal • With existing clients re-negotiation of the current policy terms and conditions, particularly if your clients’ circumstances have changed.

You may need to discuss matters like turnover, marine sendings, wages, stock values, business interruption values and more.

Other variables such as deductibles may impact the risk and therefore the premiums to be charged. Clients also need to consider the impact of claims-made insurance policies prior to cancelling. It’s important to note that, if and when clients do seek to cancel their insurance policies, the cancellation will only be effective from the date that they provide instructions to do so (which should always be in writing), and they should be advised that they will be liable for the pro-rata proportion of the deferred premium for the period that the cover was in force.

Each situation will be unique and insurers will need to decide on their policy for seeking to recover time on risk premiums. Similarly, requests to cancel insurance by premium funders may also arise for those clients that fall into arrears. The broker’s responsibility is to immediately notify their client that the funder has instructed that the cover be cancelled and to work to try and ensure they will remain insured if that is the requirement.

As with instructions from the client, cancellation requests from premium funders should take place from the date of instruction and not the last payment date. Only the insurer, as the issuer of the policy, can decide whether a cancellation can be backdated.

The insured, or the premium funder, can ask for it to be backdated - but the insurer will make the decision about whether they will agree to do so. Ensuring that brokers keep detailed records of client conversations and confirm everything in writing will be critical when dealing with these circumstances.

In these unique times, the role of the broker as an extension of their clients’ businesses will be pivotal to helping their clients get through this crisis and assisting them to ‘bounce back’ when the crisis passes. Now is the time for brokers to get alongside their clients and prove themselves as trusted advisors.

COVID-19 / Legal analysis

C

VID-19

LEGAL AND REGULATORY CONSIDERATIONS FOR INSURANCE BROKERS The current pandemic has created uncertainty across the world and the next few months will be tumultuous for every sector of the economy.

By Avryl Lattin, Partner; David Lee, Partner and Johann Spies, Special Counsel - Clyde & Co.

A

s social distancing continues for the foreseeable future, insurance brokers will need to assess the impact COVID-19 will have on their clients, in respect of specific claims that may arise, the broader repercussions for the economy and the changes to everyday life.

Government assistance

In order to assist Australian businesses during this period, the Commonwealth and State and Territory Governments have introduced a raft of assistance measures. These include measures to support businesses and encourage them to retain staff, rent relief packages, hardship provisions for energy, water and rates and fee and tax relief.

At the Commonwealth level, the JobKeeper package introduced under the Coronavirus Economic Response Package (Payments and Benefits) Act 2020 (Cth) was passed by the Parliament on 8 April 2020.

Under the JobKeeper payment program, eligible employers (those who have suffered a defined reduction in turnover) who register with the Australian Taxation Office will receive a $1,500 per fortnight payment for each of their eligible employees from 30 March 2020 until 27 September 2020.

State Governments have also acted to provide targeted relief. See pages 48-53 for a complete breakdown, federally and by state, of the government assistance available.

Changes to standard business trading

The Commonwealth Government has also made changes to the insolvency and bankruptcy regimes to provide businesses with breathing room during this difficult period. These measures will assist individuals and companies that may be trading in precarious financial positions.

Under the Coronavirus Economic Response Package Omnibus Act 2020 (Cth) passed by the Parliament on 23 March 2020, temporary amendments were introduced to: • increase thresholds for which statutory demands against companies and bankruptcy proceedings against individuals can be issued. These demands will now require the debt to be $20,000 or greater. The company or individual’s time to respond to the demand has also been increase from 21 days to six months; • where a debtor declares an intention to enter voluntary bankruptcy, increase the protection period from unsecured creditors recovering debts from 21 days to six months; and • for six months, directors will be temporarily exempt from personal liability from incurring debts in the ordinary course of business that results in the business trading insolvent.

The Corporations Act 2001 (Cth) was also amended to provide the Treasurer with the power to provide relief from, or modify obligations under, this Act for a period of six months without parliamentary approval.

Any such relief by the Treasurer will apply for six months from the date they are made.

Claims and notifications

Brokers are likely to already be seeing a number of enquiries and potential claims from their clients related to the impact of COVID-19.

It is likely that the COVID-19 pandemic will raise demanding questions of insurance brokers (and those that advise businesses affected by the pandemic) in relation to the extent of cover and the nature and timing of COVID-19 related notifications. The likely volume and quantum of COVID-19 related notifications is inevitably going to

put pressure on the market and it is not unrealistic to see enhanced risk for insurance brokers. We should expect to see the case law associated with blanket notifications likely to be tested and the interpretation of policy language and exclusions taking place.

Brokers will need to assist their clients to review their policy wording carefully, and consider whether COVID-19 has triggered loss which may be recoverable.

The insurance industry’s response to claims will also be closely scrutinised by regulators and parliaments, including by the House of Representatives Standing Committee of Economics which required a number of insurers to attend public hearings at the end of April 2020.

ASIC has expressed a view that it expects insurers to act with the utmost good faith when handling insurance claims during this period, and there will be increased regulatory scrutiny of the industry while the COVID-19 crisis continues and into the future. The recent action taken by ASIC against Youi for alleged breaches of the duty of utmost good faith is a clear marker in that regard.

Industry relief measures

As outlined on page 54, the Australian Competition and Consumer Commission (ACCC) granted interim authorisation for certain insurers and brokers to work together to implement COVID-19 relief measures for individuals and small businesses. Brokers may be involved in delivery of the measures on behalf of insurers and can apply to the ACCC for the interim authorisation to apply to them.

We anticipate further legal, regulatory and industry measures will be introduced to manage the impact of COVID-19 on insureds and will continue to keep the broking community updated.

NIBA.COM.AU / 55

COVID-19 / AFCA’s response

C

VID-19

AFCA EXTENDS COMPLAINT TIMEFRAMES

In response to the challenges faced during these unprecedented times, the regulator has revised its complaints process and implemented changes, effective immediately.

A

FCA has advised NIBA that they have written to members to inform them of the following change in process (effective immediately), recognising the extraordinary circumstances that we all find ourselves in due to COVID-19: The post IDR refer back timeframe will now be 30 days, which provides an additional 9 days for complaints (where matters have not been through IDR members will still have the 45 days as before). The changes will operate for six months and will be reviewed and adjusted as appropriate.

The above relates to the following AFCA Rules: • A.5.1 When AFCA receives a complaint, AFCA will notify the relevant Financial Firm in writing of the complaint.

• A.5.2 AFCA will refer the complaint back to the Financial Firm and set a timeframe for the Financial Firm to either resolve the complaint or to provide its position in relation to the complaint. This opportunity

will not normally be provided: a) if AFCA considers it appropriate to commence investigating or otherwise progressing the complaint immediately, or b) for a Superannuation Complaint relating to the payment of a death benefit.

The change is intended to allow more time for members to resolve complaints using their internal dispute resolution practices, and where that can’t be achieved, it will provide them with more time to consult and communicate with their customers, and to locate the necessary documentation and information needed for AFCA to consider the matter.

This is in addition to the extension AFCA has already granted to members for its initial case management stage (ICMN), which has also increased from 21 to 30 days.

According to an AFCA spokesperson, as of 17 April, it had received over 870 calls and more than 7,000 visits to its dedicated support webpage, with around 630 complaints received relating to coronavirus (COVID-19).

It was reported that most of these complaints have been about the denial of

travel insurance claims – including the cancellation/change of travel plans, refund of premiums for cancelled travel and lack of cover.

AFCA has also received a small number of banking and finance and financial difficulty complaints.

AFCA is meeting regularly with the insurance industry to discuss and understand the challenges we all face in these unprecedented times.

Issues will continue to develop as we work our way through this crisis. AFCA anticipates an increase in claims relating to involuntary unemployment, income protection, landlord loss of rent and business interruption as well as the travel claims. They are already hearing about consumers wanting to put their claim on hold or delay repairs until the crisis is over. At the same time, insurers may have difficulty with the supply chains causing further delays. The spokesperson said communicating and working together is the best way to overcome these issues.

AFCA has a COVID-19 information hub on its website afca.org.au/covid-19 and has set up a COVID-19 hotline, 1800 337 444.

According to an AFCA spokesperson, as of 17 April, it had received over 870 calls and more than 7,000 visits to its dedicated support webpage, with around 630 complaints received relating to coronavirus (COVID-19).

56 / INSURANCE ADVISER MAY/JUNE 2020

“QPIB has never been more relevant than right now.”

ING IS

U

RA

K

ER

QPIB

S

Apply online at niba.com.au or email NIBA Memberships Manager Audi Witsen – awitsen@niba.com.au

D PRAC IE T F I

IN

QPIB – A STATEMENT OF PROFESSIONALISM

• QUA L

– JORDYN GILBERT, 2019 WA YOUNG PROFESSIONAL BROKER OF THE YEAR

NCE BR

O

COMMUNITY HUB

COMMUNITY HUB MAY/JUNE 2020

The COMMUNITY HUB is your space to showcase your products and services to a specialist audience.

INDEX AB Phillips ..................................................... 58 ASR Underwriting ..................................... 59 Newline Group ............................................60

Affinity Insurance Brokers .................... 60 MGA Insurance Brokers ......................... 61 Moran Insurance Brokers ...................... 61 AIBI .................................................................. 62

Tudor Insurance .......................................... 62 Trident Marine Insurance......................... 63 Marsh & McLennan Agency.................. 63 All Parks Insurance...................................... 63

WANT TO ADVERTISE IN THE INSURANCE ADVISER? If you’re a NIBA member with a product or scheme you’d like to promote to a broker audience in our Community Hub section, please contact Tony May E: tmay@niba.com.au

Exclusive timber and sawmill insurance facility AB Phillips has been insuring the Timber and Sawmilling industry for more than 25 years. We have an exclusive underwriting facility which is available to select brokers.

Our insurance facility is for clients in the following sectors: • • • • •

Timber yards Timber storage Timber processors Sawmills Roof truss and wall frame manufacturers

Commission is paid on placements.

For more information please contact Rose Dee on:

Phone: 1800 819 394 | Direct: 03 8586 9316 | Email: rose@abphillips.com.au AB Phillips Pty Ltd. Australian Financial Services Licence No. 234457. ABN: 91 007 075 934. PO Box 832 Moorabbin VIC 3189. 445 Warrigal Rd Moorabin VIC 3189. e: info@abphillips.com.au t: 03 8586 9333 f: 03 8586 9394 w: www.abphillips.com.au

Linda Sepala Chief Executive Officer / Underwriting Manager – Liability

Underwriting Manager – D&O & FI

Underwriting Manager - PI

PH: 03 9998 1900

TD00430 NEWLINE 210x146_OL.indd 1

20/4/17 2:16 pm

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Untitled-20 1

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COMMUNITY HUB

NIBA.COM.AU / 61

COMMUNITY HUB

�aibi

Adult Industry Business Insurance

BE PART OF NIBA Advertise with the most influential and trusted voice in the Australian intermediated insurance industry

Insurance Adviser · Insurance and Risk website Broker Buzz · Need a Broker website · Targeted eDMs · NIBA events (Annual Convention)

WE ARE YOUR VOICE Contact Tony May National Advertising Sales Manager T: 02 9459 4303 E: tmay@niba.com.au

AIBI is a registered trading name of Capital Mutual Insurance Brokers Pty Ltd. Capital Mutual Insurance Brokers Pty Ltd is a Corporate Authorised Representative of McLardy McShane Partners Pty Ltd, Australian Financial Services Licence No 232987 ABN 14 064 465 309.

McLardy McShane Partners Pty Ltd is a member of The Steadfast Group.

Demolition and Asbestos Removal Liability Insurance Benefits of dealing with LSM:

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please contact:

Untitled-2 1

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62 / INSURANCE ADVISER MAY/JUNE 2020

Tudor ABN: 19 876 513 568

Cameron McKerchar e: service@tudorinsurance.com.au

26/10/18 2:49 pm

COMMUNITY HUB

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PLEASE VISIT OUR WEBSITE, AND CLICK ON "PRODUCTS AND SERVICES" FOR MORE DETAILS www.marshmc.com.au

CONTACT Michael Beveridge

08 8385 3630 or

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08 8385 3583 newbusiness@marshmc.com Marsh and McLennan Agency Pty Ltd ABN 33 000 668 584 / AFSL 238984

517-3776

NIBA.COM.AU / 63

INSURER STRENGTH RATINGS

S&P GLOBAL

INSURER FINANCIAL STRENGTH RATINGS

The following list of S&P Global Ratings insurer financial strength ratings assigned to insurance companies in Australia and New Zealand. Ratings at 26 April, 2020.

Contact: Craig Bennett, S&P Global Ratings Telephone: 03 9631 2197

NEW ZEALAND

RATING

NON-LIFE INSURERS

AUSTRALIA

RATING

NON-LIFE INSURERS AAI Ltd.

A+/POSITIVE

AIG Australia Limited

A/STABLE

Allianz Australia Insurance Ltd.

AA-/STABLE

BHP Billiton Marine & General Insurances Pty Ltd. A/STABLE Chubb Insurance Australia Ltd.

AA-/STABLE

Great Lakes Insurance S.E (Australia Branch)

AA-/STABLE

Hallmark General Insurance Co. Ltd.

BBB+/STABLE

Insurance Australia Ltd.

AA-/STABLE

Society of Lloyd's

A+/STABLE

Medical Insurance Australia Pty Ltd.

A-/STABLE

QBE Insurance (Australia) Ltd.

A+/STABLE

QBE Insurance (International) Ltd.

A+/STABLE

Zurich Australian Insurance Ltd.

A+/POSITIVE

AA Insurance Ltd.

A+/POSITIVE

AIG Insurance New Zealand Ltd.

A/STABLE

Chubb Insurance New Zealand Ltd.

AA-/STABLE

Hallmark General Insurance Co. Ltd. (NZ Branch)

BBB+/STABLE

IAG New Zealand Ltd.

AA-/STABLE

Society of Lloyd's

A+/STABLE

Medical Insurance Society Ltd.

A-/POSITIVE

Southern Cross Benefits Ltd.

A/STABLE

Southern Cross Pet Insurance Ltd.

A/STABLE

LIFE INSURERS

Teleco Insurance (NZ) Ltd.

BBB+/STABLE

AIA Australia Ltd.

A+/STABLE

Vero Insurance New Zealand Ltd.

A+/POSITIVE

AMP Life Ltd.

A-/NEGATIVE

Vero Liability Insurance Ltd.

A+/POSITIVE

Challenger Life Company Ltd.

A/STABLE

Colonial Mutual Life Assurance Society Ltd. (The)

A+/STABLE

Hallmark Life Insurance Co. Ltd.

BBB+/STABLE

MetLife Insurance Ltd.

A+/STABLE

Westpac Life Insurance Services Ltd.

A+/STABLE

HEALTH INSURERS Southern Cross Medical Care Society

A+/STABLE

NIB NZ Ltd.

A-/STABLE

LENDERS MORTGAGE INSURERS Genworth Financial Mortgage Insurance Pty Ltd. (NZ Branch)

A/STABLE

LIFE INSURERS

LENDERS MORTGAGE INSURERS Genworth Financial Mortgage Insurance Pty Ltd.

A/STABLE

QBE Lenders' Mortgage Insurance Ltd.

A/STABLE

Westpac Lenders Mortgage Insurance Ltd.

AA-/NEGATIVE

REINSURERS General Reinsurance Australia Ltd.

AA+/STABLE

General Reinsurance Life Australia Ltd.

AA+/STABLE

Asteron Life Ltd.

A+/POSITIVE

Hannover Life Re of Australasia Ltd.

AA-/STABLE

Hallmark Life Insurance Co. Ltd. (NZ Branch)

BBB+/STABLE

Munich Reinsurance Co. of Australasia Ltd.

AA-/STABLE

Medical Life Assurance Society Ltd.

A-/POSITIVE

RGA Reinsurance Co. of Australia Ltd.

AA-/STABLE

Westpac Life-NZ-Ltd.

A+/NEGATIVE

SCOR Global Life Australia Pty Ltd.

AA-/STABLE

Swiss Re Life & Health Australia Ltd.

AA-/STABLE

*For the S&P Global Insurer Financial Strength Ratings Definitions visit: https://www.niba.com.au/resource/standardandpoors.pdf Copyright © 2020 S&P. This material is reproduced with the permission of S&P. Reproduction of this the S&P Information in any form is prohibited without S&P’s prior written permission. Neither S&P, its affiliates nor any of their thirdparty licensors: (a) guarantee the accuracy, completeness or availability of the S&P information, or (b) make any warranty, express or implied, as to the results to be obtained by Insurer Financial Strength Ratings or any other person from the use of the S&P information or any other data or information included therein or derived therefrom, or (c) make any express or implied warranties, including any warranty of merchantability or fitness for a particular purpose or use, or (d) shall in any way be liable to Insurer Financial Strength Ratings or any recipient of the S&P information for any inaccuracies, errors, or omissions, regardless of

64 / INSURANCE ADVISER MAY/JUNE 2020

cause, in the S&P information or for any damages, whether direct or indirect or consequential, punitive or exemplary resulting therefrom.

Ratings are statements of opinion, not statements of fact or recommendations to buy, hold, or sell any securities. S&P Global (Australia) Pty. Ltd. holds Australian financial services licence number 337565 under the Corporations Act 2001. S&P Global credit ratings and related research are not intended for and must not be distributed to any person in Australia other than a wholesale client (as defined in Chapter 7 of the Corporations Act). Ratings are based on information received by Ratings Services. Other divisions of S&P Global may have information that is not available to Ratings Services.

INSURER STRENGTH RATINGS

BEST’S

NEW ZEALAND

FINANCIAL STRENGTH RATINGS

The following list of AM Best Financial Strength Ratings (FSRs) assigned to insurance companies in Australia and New Zealand. Ratings as at 5 May, 2020.

Contact: Scott Ryrie, Co-CEO A. M. Best Asia-Pacific (Singapore) Pte Ltd. Board Member and Commercial Director for Asia Pacific Tel: +65 6303 5007

AUSTRALIA

RATING

LIFE, ANNUITY AND ACCIDENT General Reinsurance Life Australia Ltd.

A++/STABLE

PROPERTY/CASUALTY

RATING

COMPOSITE Quest Insurance Group Limited

B/STABLE

LIFE, ANNUITY AND ACCIDENT American Income Life Insurance Company (New Zealand Branch)

A+/ NEGATIVE

BNZ Life Insurance Limited

A/STABLE

CIGNA Life Insurance New Zealand Limited

A/STABLE

Co-operative Life Limited

B++/STABLE

DPL Insurance Limited

B+/POSITIVE

Fidelity Life Assurance Company Limited

A-/STABLE

Foundation Life (NZ) Limited

A-/STABLE

General Reinsurance Life Australia Limited (New Zealand Branch)

A++/STABLE

Kiwi Insurance Limited

A-/STABLE

Lifetime Income Limited

B/STABLE

Momentum Life Limited

B++/STABLE

Partners Life Limited

A-/STABLE

Pinnacle Life Limited

B/STABLE

Ansvar Insurance Limited

A-/STABLE

First American Title Insurance Company of Australia Pty Limited

A/STABLE

General Reinsurance Australia Ltd

A++/STABLE

Guild Insurance Limited

A-/STABLE

Aioi Nissay Dowa Insurance Company, Limited (New Zealand Branch)

A+/STABLE

The Hollard Insurance Company Pty Ltd

A-/STABLE

Beneficial Insurance Limited

B++/STABLE

The New India Assurance Company Limited (Australia Branch)

A-/NEGATIVE

Brightsideco Insurance Limited

B/STABLE

Pacific International Insurance Pty Limited

B++/STABLE

Consumer Insurance Services Limited

B++/NEGATIVE

Rating Disclosure: Use and Limitations: A Best’s Credit Rating (BCR) is a forward-looking independent and objective opinion regarding an insurer’s, issuer’s, or financial obligation’s relative creditworthiness. The opinion represents a comprehensive analysis consisting of a quantitative and qualitative evaluation of balance sheet strength, operating performance and business profile or, where appropriate, the specific nature and details of a security. Because a BCR is a forward-looking opinion as of the date it is released, it cannot be considered as a fact or guarantee of future credit quality and therefore cannot be described as accurate or inaccurate. A BCR is a relative measure of risk that implies credit quality and is assigned using a scale with a defined population of categories and notches. Entities or obligations assigned the same BCR symbol developed using the same scale, should not be viewed as completely identical in terms of credit quality.

Alternatively, they are alike in category (or notches within a category), but given there is a prescribed progression of categories (and notches) used in assigning the ratings of a much larger population of entities or obligations, the categories (notches) cannot mirror the precise subtleties of risk that are inherent within similarly rated entities or obligations. While a BCR reflects the opinion of A.M. Best Rating Services, Inc. (AMBRS) of relative creditworthiness, it is not an indicator or predictor of defined impairment or default probability with respect to any specific insurer, issuer, or financial obligation. A BCR is not investment advice, nor should it be construed as a consulting or advisory service, as such; it is not intended to be utilised as a recommendation to purchase, hold or terminate any insurance policy, contract, security, or any other financial obligation, nor does it address the suitability of any particular policy or contract for a specific purpose or purchaser. Users of a BCR should not rely on it in making any investment decision; however, if used, the BCR must be considered as only one factor.

Users must make their own evaluation of each investment decision. A BCR opinion is provided on an “as is” basis without any expressed or implied warranty. In addition, a BCR may be changed, suspended, or withdrawn at any time for any reason at the sole discretion of AMBRS.

PROPERTY/CASUALTY

First American Title Insurance Company of Australia A/STABLE Pty Limited (New Zealand Branch) FMG Insurance Limited

A/STABLE

General Reinsurance Australia Ltd (New Zealand Branch)

A++/STABLE

Health Services Welfare Society Limited

B+/STABLE

The Hollard Insurance Company Pty Ltd (New Zealand Branch)

A-/STABLE

Mitsui Sumitomo Insurance Company Limited (New Zealand Branch)

A+/STABLE

The New India Assurance Company Limited (New Zealand Branch)

A-/NEGATIVE

New Zealand Medical Professionals Limited

B+/STABLE

Pacific International Insurance Pty Ltd (New Zealand Branch)

B++/STABLE

Police Health Plan Limited

A-/STABLE

Provident Insurance Corporation Limited

B /STABLE

Tokio Marine & Nichido Fire Insurance Company Limited (New Zealand Branch)

A++/STABLE

Tower Insurance Limited

A-/STABLE

Union Medical Benefits Society Limited

A/STABLE

Virginia Surety Company, Inc. (New Zealand Branch)

A/STABLE

NIBA.COM.AU / 65

INSURANCE JOURNEY / Angela O’Neil

FROM JUST A JOB TO A REWARDING CAREER

NIBA NSW Mentoring Committee Member and Senior Account Manager at Resilium, Angela O’Neil, tells us why she is excited to be a part of this industry

“I

got into insurance at 19, I was lucky enough to have a friend who gave me a chance to be a filing clerk one day a week with a workers compensation underwriter. I saw that the office life wasn’t nearly as dull as I thought it may be and very quickly forced my way into their full-time team and trialled all aspects of the business before deciding to give broking a go, many years later.

At the beginning, it was just a job – a chance to get some money in my pocket, then it became a career that I was passionate about and gave me the chance to meet some amazing people.

Before insurance I was waitressing in a pizza place, so I smelled a lot better once full-time office work started, plus, how good is sitting down sometimes.

What makes insurance interesting to me is that the situations our clients face keep us on our toes, they test our knowledge constantly and give us reason to pursue further professional learning.

“After more than 20 years I am still seeing new things come through every week. ” After more than 20 years I am still seeing new things come through every week. Looking after an authorised representative network means that we are helping small businesses all over the country, it is the most rewarding role that one can imagine.

The biggest lesson I have learnt in my career so far, is that, the world is very small and the insurance world even smaller. We need to support each other, do what we can to lift those around us and be someone that elicits trust.

In this industry, there’s never a dull

PROUDLY SUPPORTING

66 / INSURANCE ADVISER MAY/JUNE 2020

week to be had or you’re doing it all wrong. The clients, the colleagues, the learning all keep things interesting.

Our job occasionally is to be there when everything has gone wrong for someone, and whilst that can be tough, it is wonderful to be there for individuals and businesses in their time of need.

I would not change anything about my career journey, less paper cuts at the start perhaps. I’ve literally worked my way from the filing room and feel confident that it has helped me to understand what everyone in the room is going through

when the Resilium team meets.

I’ve been bouncing my ideas off people my whole career and I’ve been very fortunate to have some wonderful people listen to them, I am pretty passionate so it takes a special kind of person to help me see clearly and talk me down when I get on a roll. I have also had a formal mentor who helped me a great deal.

I believe deeply in the power of mentoring as the best way to ensure that the knowledge of senior brokers and their lessons in professionalism are passed on to younger brokers.”

SIX QUICK QUESTIONS Secret ambition?

Well duh, to sing with Celine at Caesar’s Palace (oh and to learn to sing at all).

Favourite film?

Wizard of Oz. Favourite book?

Life is So Good by George Dawson.

Favourite tipple?

Margarita.

Favourite past-time?

Shrieking at sports teams and giving intelligent coaching tips from the grandstand slash loungeroom.

Favourite food?

Anything with chicken in it.

Share your insurance journey. Email editor@niba.com.au

icare is transforming workers insurance in NSW. With icare, employers and injured workers are treated fairly to keep writing their futureâ&#x20AC;Ś because life is to be continued.

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