Insurance Adviser - August 2021

AUGUST 2021

PROFESSIONALISM + RESILIENCE = OPPORTUNITY

#NIBA2021

An experience unlike any other

FRESH THINKING NEEDED

Accident and Health Insurance

A PARTICULARLY COMPLEX WEB

Workers’ Compensation in Australia

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Local Presence, Global Strength www.brooklynunderwriting.com.au

CONTENTS August 2021

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FEATURES

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

2021 NIBA CONVENTION

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 Wendy Martin

THANKS TO OUR PRINCIPAL PARTNERS

NIBA Editor Tanaya Das

Editorial enquiries

E:!editor@niba.com.au

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

Design

26

#NIBA2021

An experience unlike any other

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.

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.

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ACCIDENT AND HEALTH Making sense of a precarious segment

NIBA.COM.AU / 3

CONTENTS August 2021

FEATURES

IN EVERY ISSUE NIBA CEO Welcome...................................... 6 Representation ..................................................8 Why be a NIBA member? ..............................10 Insurance Journey: Ian Goninon ............... 58

NEWS

Industry bulletin.............................................12 Regulatory reminders.................................... 16 NIBA Submission round-up ......................... 18

PROFESSIONALISM

AFCA case study ........................................20 What clients want from your website .... 21 Back to work ................................................22

ANALYSIS

Legal: Testing for COVID-19 ...................24

40 A CONFUSING TANGLE

Unravelling the challenges in Workers’ Compensation 4 / INSURANCE ADVISER AUGUST 2021

EVENTS

Forthcoming events.................................... 55

REFERENCE

Community hub ........................................... 48 Insurer strength ratings............................... 56

CEO / Welcome

A TIME OF CHANGE

S

ome rather big things are happening at the present time and will continue to develop over the coming months and years.

Royal Commission Reforms

Most insurance brokers are now working to understand the impact that the Royal Commission reforms will have on their business operations and processes. Design and Distribution Obligations, Anti-Hawking Reforms, Deferred Sales Model, Disclosure of Non-Independence, and many other reforms will need to be implemented within all broking firms, in addition to regulatory changes relating to internal dispute resolution and breach reporting. For a sector which was not mentioned in the Royal Commission into Misconduct in Banking and Financial Services, it is quite extraordinary that insurance brokers are having to cope with such an extensive change program.

Code of Practice

NIBA continues to work on the review of the Insurance Brokers Code of Practice. This is taking time, because it is important that we get it right. A Code of Practice is an industry’s commitment to its current and potential clients, and in the current post-Royal Commission climate, expectations of external parties are now very high.

There are too many examples of poor client outcomes in other areas of the financial services industry, and it is crucial the new Insurance Brokers Code of Practice sets appropriately high standards of professionalism, ethics and integrity.

More importantly, high standards must not just be set out in the new Code of Practice – they must be actively embraced, adopted and applied in the ordinary and everyday operations of insurance broking firms. Most do this already, but we must make sure all brokers are working to the highest standards of professional conduct and behaviour.

The Insurance Market

I continue to receive comments about the state of the insurance market – from members, and from government agencies who are concerned about issues with availability and affordability at the present time. In mid-July 2021, I am not seeing any signs of movement in the so-called insurance cycle, and I fear the very hard market might be something that will be with us for some time. This is the time for insurance brokers to shine – to show real value to their clients as to how best to assess, manage and finance their risks.

Northern Australia

The big change in northern Australia will be the Cyclone Reinsurance Pool, currently under development by a Treasury Taskforce. The challenges with this project are great, but the need for genuine relief is real. NIBA will do its best to make sure the Cyclone Reinsurance Pool provides genuine benefit to policyholders and property owners across northern Australia, and in Far North Queensland in particular.

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NIBA Convention

While we had a largely (but not completely) successful virtual NIBA Convention in 2020, we do have to acknowledge that there is an overwhelming demand for a Convention experience to be provided on a face-to-face basis. But we also need be realistic about the current state of the COVID-19 pandemic in Australia, and the impact it is having on border crossings and community lockdowns.

We have decided to change the format to get the best of both worlds, with a Convention experience being offered in five capital cities over five weeks. Brokers will not have to cross borders – they can attend the Convention in their own state and will be able to access the other four conference sessions virtually.

We will again provide over 10 hours of highly relevant content as part of the Convention program, with real opportunities to gain significant CPD points along the way. And we will also provide opportunities for brokers to meet face-to-face with sponsors and exhibitors, and with their industry colleagues to discuss the challenges and opportunities we all face.

NIBA

A significant change is about to take place within NIBA. As the President has previously announced, I will retire as Chief Executive on 31 October 2021, and Philip Kewin will take on the role from 1 November 2021.

Philip has tremendous experience as the former Chief Executive Officer of the Association of Financial Advisers. He is very well-trained in the challenging tasks of industry representation, government relations and lobby. He will be an excellent spokesperson for insurance brokers and will make a great contribution to the future of insurance broking in Australia.

He will commence at NIBA in a transitional capacity on 16 August 2021, and I look forward to sharing my knowledge and experience with Philip in the coming months.

Insurance Broking 2025

On 2 August 2021 the President, VicePresident and I will present the outcome of the NIBA Board’s project to consider what insurance broking will look like in 2025. This is very exciting. I am looking forward to it. In the meantime, please stay safe, stay healthy, and get vaccinated as fast as you can.

DALLAS BOOTH Chief Executive Officer, NIBA

ADVERTORIAL / QBE

RISKY BUSINESS: INSURING THE GIG ECONOMY

W

hether it’s a spare-time side hustle or a way of working to which someone’s fully committed, the gig economy – otherwise known as the on-demand economy – essentially refers to any kind of casual, short-term work.

It’s a term used to capture people working in a non-traditional way, maybe via digital platforms such as Airtasker or working on a freelance basis, engaging with businesses job by job. From delivery drivers to doctors, exercise professionals to Etsy store owners, professional services to IT contractors, there is a wealth of Australian professional people working in this way – 3.3 million of them, in fact.

For many, it’s a choice that facilitates the lifestyle they desire. For others, it’s a means to an end. One thing’s for sure, though: it’s serious business. Data shows that between 2015 and 2019, the value of the gig economy grew ninefold to $6.3bn, and at last count 62.8 per cent of businesses in Australia were sole traders.

Add to that the impact of the pandemic – which saw an actual unemployment rate of 7.4 per cent in June 2020 (a 21-year high) and an effective unemployment rate of 15 per cent in April 2020 – and those figures are likely to be higher as people seek alternative ways of working in the future.

“With the pandemic we’ve seen a rapid shift in what work looks like,” says Janette O’Neill, QBE’s Head of Sustainability. “There are clearly lots of benefits for gig workers around how they utilise their time, where they choose to work and how they make their money. It also provides flexibility for employers as they’re not locked into long-term contracts.

“But then there are also a lot of risks.”

The risks of working in the gig economy While the freedom of working in the gig economy is understandably attractive, it comes at some cost. Of course, the certainty of employment simply isn’t there. And as well as the regular salary and superannuation contributions, the other benefits of employment are foregone – annual leave,

personal and sick leave, long-service leave, parental leave and carer’s leave, for example.

And then there are insurances. Employees would usually be covered by their employer’s professional indemnity and public liability policies, for example. And then there’s workers’ compensation, which gig-economy workers in Australia currently fall outside of.

“Many people going out on their own and working in this way probably aren’t too aware of the insurance side of things,” says Sharron Sykes, QBE’s National Underwriting Manager – Australia. “But navigating the insurance needs – particularly when it comes to workers’ compensation – is very challenging.”

Sole traders cannot cover themselves as an employee for workers’ compensation, and contractors need to check with each individual employer about whether they’re covered under the employer’s scheme.

Group personal accident insurance for gig-economy workers

Of course, one of the ways gig-economy workers can protect themselves is by taking out their own insurance – and Group Personal Accident and Sickness insurance, part of the QBE Accident and Health suite, can provide the required cover.

Group Personal Accident and Sickness insurance can provide group cover to companies or common interest groups. By identifying groups of workers via membership groups or associations, tailored coverage can be created.

“One of the benefits with accident and health products is it can be much more flexible than workers’ compensation,” says Sykes. “Workers’ compensation is quite fixed around the benefits that can be provided, as determined by the relevant state legislation, whereas with accident and health we can actually ask people what’s keeping them up at night – we want people to understand that we’re insuring one of their most important assets, which is their income.”

For people working in the gig economy, the profession’s membership body or industry association is a good first port of call to enquire whether there’s a group personal

accident insurance scheme for gig-economy workers in that profession.

“You could take similar cover out as an individual, but it’s going to be much more beneficial to be part of a group-purchasing arrangement because you’ll get the economies of scale around pricing and the level of cover you’ll receive,” says Sykes.

And if the relevant membership groups or associations don’t have this type of arrangement, just ask. After all, it’s just another aspect of the ever-changing world of work in which we belong.

Income protection insurance is another important consideration for those working in the gig economy – after all, their ability to earn relies completely on their physical and mental ability to do the work.

Creating a sustainable future for the gig economy

The world of work has changed significantly, and new challenges – such as ensuring gigeconomy workers have the requisite level of insurance cover – will emerge along the way.

“A few years ago, if people talked about the future of work, they usually referred to the building and the way employees worked together within that building,” says O’Neill.

“Now it’s far broader than that.”

The gig economy is an important way of working and can help businesses and the individual – and potentially help society as a whole. “By supporting ways of work that have low barriers to entry, we create more opportunity and support social and economic wellbeing.” says Sykes.

And for those who are grabbing those opportunities, it’s vital they have an insurance safety net to protect them – because the one that’s there in traditional employment simply isn’t on offer when you’re going it alone.

If you’d like to learn more about the cover gig-economy workers need, and to discuss QBE’s Group Personal Accident and Sickness insurance, visit QBE’s website at qbe.com/au

NIBA.COM.AU / 7

NEWS / Representation

WE ARE YOUR VOICE!

There is a lot happening at the present time. The following are a few key developments that insurance brokers need to be aware of.

Emergency services funding in New South Wales and Tasmania

Brokers with clients in NSW or Tasmania are encouraged to visit the Emergency Services Funding page on the new-look NIBA website. There, members can find a range of materials, including an ESL fact sheet that brokers can provide to their clients and a template letter brokers and their clients can send to their local state MPs, calling for the abolition of insurancebased taxes and a more equitable system for the funding of state fire and emergency services. NIBA encourages members to share these resources with their clients.

Northern Australia Reinsurance Pool

NIBA remains heavily engaged with both Treasury and the Australian Reinsurance Pool Corporation in relation to the proposed Northern Australia Reinsurance Pool. NIBA previously provided a submission to the Treasury discussion paper on the proposed reinsurance pool. In the submission, NIBA raised a number of concerns including that projected savings to homeowners would likely not be enough to address significant disparity in premiums and would do little to increase affordability. NIBA also called for the design process to focus on increasing insurer activity in the region to promote competition and innovation. Treasury has appointed an Expert Advisory Panel which will assist the Treasury Taskforce in the development and implementation of the reinsurance pool.

This panel includes representatives from the General and Intermediated Insurance industries. NIBA can confirm that CEO Dallas Booth has been invited to join the panel.

COVID-19 Business Interruption claims Last month NIBA met with members of the Insurance Council of Australia (ICA), the

8 / INSURANCE ADVISER AUGUST 2021

Australian Financial Complaints Authority (AFCA) and the Australian Securities and Investments Commission (ASIC) to discuss the second Business Interruption (BI) test case and next steps after special leave to appeal the decision of the first test case was denied by the High Court. Following the meeting, a BI Working Group has been formed to consider ways of streamlining BI claims and BI complaints to AFCA. As part of the working group, NIBA will continue to work closely with ICA to promote an industrywide approach to COVID-19 BI claims.

Royal Commission legislation

NIBA continues to engage with ASIC and Treasury on a number of outstanding issues relating to the Royal Commission reforms, including breach reporting obligations, anti-hawking and Design and Distribution Obligations, all of which will commence in October 2021. NIBA has previously provided members with guidance on a number of Royal Commission reforms scheduled to commence later this year, with more guidance expected to be released shortly pending the outcome of these discussions. Members can access materials outlining these reforms and actions they will need to take to remain compliant on the NIBA website media hub.

Australian Law Reform Commission – Financial Services Inquiry Last month, the Australian Law Reform Commission released the first background paper as part of its inquiry into the

legislative framework for corporations and financial services regulation.

NIBA has previously engaged with the Commission to provide its views on the unnecessary complexity of financial services regulation and the failings of a one-size fits all approach. The inquiry aims to: • ensure that Australia’s Corporate and Financial legal framework supports a productive and agile financial services sector while protecting consumers; • reduce unnecessary complexity, including overlapping, inconsistent, and overly prescriptive rules, making legislation more navigable and easier to understand; • create a technology-neutral, manageable regulatory framework for regulators and government agencies to administer, and for industry to implement and comply with, efficiently and effectively.

The inquiry will provide its first interim report to Treasury by 30 November 2021, with further reports due over the next two years.

The role and value of insurance brokers

NIBA continues to meet with State and Federal MPs, Ministers and business and consumer groups to promote the Deloitte report on the Economic Value of Insurance Broking and the value of brokers more broadly ahead of the 2022 review into the intermediated insurance industry.

NIBA is preparing for the review, and we look forward to sharing more information with you at the 2021 NIBA Convention.

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 / Member Benefits

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

“Being a broker for 23 years, I have always respected what NIBA has done for our industry. I have loved reading all the magazines over the years, attended some fun conferences, and made some lifetime friends. I respect all of the hard work NIBA does in lobbying for us as brokers and I am thankful to be a part of an industry that has such a powerful association representing us.”

JODI SHARMAN NIBA Victoria Committee Member and Managing Principal at Marsh Advantage Insurance Pty Ltd

WELCOME TO NIBA

NIBA is thrilled to have the following new principal member on board: •$Avatar Brokers Pty Ltd from Victoria

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.

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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

NEWS / Industry Bulletin

NIBA PRESIDENT ANNOUNCES APPOINTMENT OF NEW CHIEF EXECUTIVE OFFICER

T

he President of the National Insurance Brokers Association (NIBA), Dianne Phelan has announced that the Association’s Board has appointed Philip Kewin as the new Chief Executive Officer (CEO).

Kewin will join NIBA on 16 August 2021 to commence a period of transition, working closely with the current Chief Executive Officer, Dallas Booth, who will retire from the role on 31 October 2021.

Phelan, pictured below, said, “The NIBA Board acknowledges the significant contribution outgoing CEO Dallas Booth has made for the benefit of all members.

He will be missed and we look forward to a more formal acknowledgement of Dallas later in October.”

Philip Kewin joins NIBA following a long career in financial services, most recently as Chief Executive Officer at the Association of Financial Advisers, a role he has held for the last four years. He has been extensively involved in representing

the interests of AFA members and the financial advice industry more broadly, particularly with the Federal Government, the Federal regulator, ASIC, as well as other key industry bodies and stakeholders. During his tenure, he oversaw significant growth of AFA members at a time when total adviser numbers were shrinking.

Prior to his four years’ service at the AFA, Kewin was responsible for the Adviser Life Risk and Investment business at Zurich Australia, including five years as General Manager of Life and Investments. Prior to Zurich, he had his own financial planning business.

Phelan revealed that the NIBA Board Succession Committee undertook an extensive search process in conjunction with a professional recruitment firm.

Arrangements will be made for Kewin to meet members, key stakeholders and other industry representatives after he joins the organisation, confirmed Phelan.

COVID-19 INDEMNITY SCHEME

T

he Federal Government has announced that it is establishing a COVID-19 Vaccine Claim Scheme to provide assurance and confidence to patients and health professionals in the COVID-19 vaccine rollout.

Minister for Health and Aged Care, Greg Hunt has revealed in the event someone suffers a significant adverse reaction, causing injury and economic loss because of vaccination, the Scheme will help guide potential claimants through a no-fault claims process scheme.

Under the scheme, proven claims will be able to receive appropriate compensation without the need of formal court processes. Potential claimants accessing the scheme will still have the option of pursuing action through a court judgement if that is their preference.

The COVID-19 Vaccine Claims Scheme will be backdated to the start of the national vaccine rollout – 22 February 2021 – and will be linked to the Human Biosecurity Emergency Period under the Biosecurity Act 2015. The scheme will support claims made against privately practising health professionals who administer a COVID-19 vaccine approved for use by the Therapeutic Goods Administration (TGA).

Details of the COVID-19 Vaccine Claims Scheme will be finalised in consultation with peak bodies, indemnity insurers, patient groups and states and territories.

For breaking news and updates curated specially for insurance brokers please visit: niba.com.au/articles

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NEWS / Industry Bulletin

NIBA WELCOMES THE NEW GENERAL INSURANCE CODE OF PRACTICE

T

he National Insurance Brokers Association (NIBA) CEO Dallas Booth has welcomed the new General Insurance Code of Practice as the new benchmark commitment by insurers and their representatives towards policyholders and consumers.

Booth said, “There are a number of significant changes in the new General Insurance Code, particularly in relation to vulnerable customers and customers in financial distress. Insurance brokers acting on behalf of insurers will adopt and follow the new General Insurance Code requirements. In addition, NIBA will ensure the new Insurance Brokers Code of Practice will be consistent with the General

Insurance Code when the Insurance Brokers Code is finalised later this year.”

Effective 1 July 2021, the updated General Insurance Code includes strengthened customer protections in line with community expectations and has been developed by insurers in consultation with a range of stakeholders including consumer groups.

Features of the new General Insurance Code include: • Sanctions for significant Code breaches of up to $100,000 in the form of Community Benefit Payments • Independent enforcement through the Code Governance Committee (CGC)

•

Cost comparisons between new and previous policies on renewal notices • Responsibility for quality of repair work undertaken on behalf of insurers • Streamlined complaints process • Mandatory standards for claims investigators • Clear timeframes to respond to claims, complaints and information requests • Cash settlements better explained.

If an insurer is found to have significantly breached the Code, one of the sanctions available to the CGC is to impose a penalty in the form of a Community Benefit Payment of up to $100,000.

For breaking news and updates curated specially for insurance brokers please visit: niba.com.au/articles

NIBA.COM.AU / 13

NEWS / Industry Bulletin

CELEBRATING THE EXCELLENCE AND PROFESSIONALISM IN INSURANCE BROKING

N

IBA has now revealed the five region winners of its two awards, which recognise excellence in the insurance broking profession.

The Broker of the Year Award, sponsored

by QBE, goes to an individual broker who is deemed an inspirational role model for the broking community, and has demonstrated

excellence in broking practice and client advocacy. The Young Professional Broker of the Year Award, sponsored by Vero, recognises the broking industry’s rising stars under the age of 35.

NIBA CEO Dallas Booth congratulated the winners of the state awards, adding: “We wish all the winners the very

best of luck for the national titles and congratulate all the finalists who exemplify the highest standards of professionalism and competence in the insurance broking profession.

“We had a significant number of applications this year and the finalists represent the cream of the crop.”

2021 NSW/ACT Awards Broker of the Year

Winner: Craig Claughton of Marsh Valley s and Amanda Morris of Arma Insurance Brokers Hunter Finalists: Leo Driessen of Driessen Insurance Broker

Young Professional Broker of the Year

Winner: Megan Farmer of Markey Insurance & Risk rs Insurance Brokers ce Brokers Newcastle and Lindsay Turner of Warren Saunde Insuran Finalists: Kayla Smith of Ian Jones

2021 Qld Awards Broker of the Year

rs Winner: Tony Venning of Crucial Insurance and Risk Adviso Tamara Trotman of Aon and re Comsu okers Austbr of Kimber David ts: Finalis

Young Professional Broker of the Year

Advisors Winner: Alishia Oliver of Crucial Insurance and Risk Scott Mitchell of Cornerstone Risk Group and Aon of s Hasting n , Lachla Finalists: Taela Bloemers of CorpSure Insurance Broking

2021 Vic/Tas Awards Broker of the Year

Group Winner: Ian Goninon of Capital Innovation Insurance Robert Villano of Network Insurance Group and ywide Countr okers Austbr of O’Reilly Finalists: Andrew Arcuri of Arcuri & Associates, Mark

Young Professional Broker of the Year

s Winner: Mitchell Wight of Integral Insurance Service Neville of Aon Risk Solutions Maxine and lia Austra nies Compa n Lockto of an Finalists: Ashleigh Woodm

2021 WA Awards Broker of the Year

Winner: Jeff Booth of GSK Insurance Brokers Imperium Insurance & Financial Solutions Finalists: Sarsha Neal of Marsh and Sumit Sopori of

Young Professional Broker of the Year

s Winner: Luke Cameron of Albany District Insurance Broker s and Robbie Gibbs of Risk Guidance Insurance Finalists: Joel Middleton of Knightcorp Insurance Broker

2021 SA/NT Awards Broker of the Year

Winner: Karen Skinner of MGA Insurance Brokers Finalist: Kate Edgar of CBD Insurance Services

Young Professional Broker of the Year

Winner: Pat McCole of Aon s ce Brokers and Nikia Goers of Webber Insurance Service Insuran PSC of Finalists: Jasmine Miller for Young Professional ce Broker of the Year and Warren Tickle Memorial Award The national Stephen Ball Memorial Award for Insuran tion.

Conven NIBA 2021 the s and announced during Broker of the Year will be chosen from five region winner

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NEWS / Upcoming Regulatory Changes

UPCOMING REGULATORY CHANGES

October is fast approaching and with it a raft of sweeping regulatory changes that all brokers need to be aware of. These changes will affect almost every broker, so it is critical that members have a thorough understanding of the changes and the impact they will have on their business.

Reference checking and information sharing: The new provisions will require AFS licence holders to comply with new reference checking and information sharing protocols which will shortly be released

by ASIC. These requirements will apply to authorised representatives of life risk brokers, and do not apply to representatives giving advice only in relation to general insurance products. The new rules take effect on 1 October 2021.

Hawking of financial products: Complex new provisions relating to the “hawking” of insurance products will take effect on 5 October 2021. The provisions do not apply when an insurance broker is giving personal advice to a retail client, but they will apply to insurance brokers operating under a general advice model.

The provisions will prevent the unsolicited marketing and sale of financial products to retail clients. The definitions and concepts are difficult and complex.

NIBA is currently seeking clarity from Treasury on a number of issues relating to the proposed provisions and will provide further information to members once these matters are resolved.

Duty to take reasonable care not to make a misrepresentation: These reforms relate to a newly defined category of “consumer insurance contracts”. They apply to insurance obtained wholly or predominantly for the personal, domestic, or household purposes of the insured.

Where the new definition applies, the insured only has a duty to take reasonable care not to make a misrepresentation to the insurer before entering the consumer insurance contract. The changes

16 / INSURANCE ADVISER AUGUST 2021

relate to insurance contracts entered into on or after 5 October 2021.

For non-consumer insurance contracts, the existing provisions in sections 21 and 22 of the Insurance Contracts Act (duty of disclosure obligations and misrepresentation provisions) apply.

NIBA will provide more information on these reforms to members.

Design and distribution legislation: The new legislation requires every financial services product covered by the regime to have a corresponding ‘target market determination’ (TMD). The products captured under the regime include all products that currently require a Product Disclosure Statement.

It is crucial that broker firms who use “broker wordings”, or their own schemes where the broker has been involved in the design of the policy and the development of the cover that is provided, work closely with the insurer/underwriter to determine how the Design and Distribution obligations will operate in respect of those policies, who will be responsible for the preparation of the Target Market Determination, and how the product review obligations will be implemented.

NIBA strongly encourages firms to obtain legal assistance for this process, in order to ensure they are meeting the new legislative obligations. There is no room for complacency, as the legislation will take effect on 5 October 2021.

ASIC has released a regulatory guide, RG 274 Product design and distribution obligations, outlining its interpretation of the obligations, compliance expectations and its approach to administering the obligations.

Deferred sales model for add-on insurance products: These reforms implement an industry-wide deferred sales model for add-on insurance products. The legislation introduces a complex array of obligations which defer the insurance transaction for a period of four days.

The legislation applies to any insurance product sold incidentally to a primary good or service – e.g. insurance sold in conjunction with the rental of a motor vehicle or travel insurance sold after the sale of a travel product. The reforms do not apply to comprehensive motor insurance, or products recommended by financial advisers in a very limited personal advice situation.

NIBA is currently liaising with Treasury to seek exemptions for a number of broker products where the immediate supply of cover provides genuine protection for consumers.

The legislation is due to take effect on 5 October 2021.

ASIC Regulatory Guide 271 – Internal dispute resolution: It is a condition of every AFS licence that the licence holder have a system for managing and resolving complaints and disputes, preferably before they are elevated to AFCA. ASIC has issued a new regulatory guide, RG 271 Internal dispute resolution, setting out its dispute resolution standards and requirements. A number of the standards and requirements set out in the RG are enforceable, so it is critical that members are aware of the new obligations.

NIBA has previously provided information to its members on this issue, which can also be accessed from the media hub on the new NIBA website under “Members only content”.

NEWS / Upcoming Regulatory Changes

The requirements only apply to complaints received on or after 5 October 2021. For complaints received by firms before 5 October 2021, Regulatory Guide 165 Licensing: Internal and external dispute resolution applies.

New breach reporting obligations These changes strengthen the breach reporting regime for financial services licensees, by replacing the current reporting obligations.

Under the new licences, licensees will be required to notify ASIC within 30 days after the AFS Licensee first knows, or is reckless with respect to whether, there are reasonable grounds to believe a reportable situation has arisen.

A reportable situation arises when:

•

the licensee or its representative has breached or is likely to have breached a core obligation and the breach is significant; • the licensee has commenced an investigation into whether the licensee or representative has breached a core obligation and the breach is significant and the investigation has continued for more than 30 days; or • in the course of providing a financial service, the AFS licensee or representative has engaged in conduct constituting gross negligence; or committed serious fraud.

The test for significance has also changed.

A breach of a core obligation is deemed to be significant if: 1. the provision breached is an offence that may involve imprisonment

(3+ months for dishonesty offences, 12+ months for others); 2. the provision breached is a civil penalty provision, or s 1041H(1) of the Corporations Act or s12DA(1) of the ASIC Act (misleading or deceptive conduct in relation to a financial product or service); or 3. the breach results, or is likely to result, in material loss or damage to clients or members.

The legislation also introduces new obligations on AFS Licensees to investigate reportable situations that may cause loss or damage to retail clients who received personal advice, to notify those potentially affected clients, and to pay compensation to affected clients within 30 days of completing the investigation.

NIBA.COM.AU / 17

NEWS / Submissions

NIBA SUBMISSIONS ROUND-UP

The National Insurance Brokers Association (NIBA) regularly provides submissions to government, parliamentary inquiries, and regulatory and other agencies, on behalf of the intermediated insurance industry.

O

ver the years, NIBA has articulated and defended the interests of insurance brokers through a range of submissions to governments, parliamentary inquiries and committees, as well as to various regulators and statutory organisations.

NIBA CEO, Dallas Booth said, “This year has proven to be quite interesting in terms of the various consultations, inquiries and topics that the Association has made submissions on. Post the Royal Commission, there have been a flurry of probes and NIBA has taken every opportunity to present the case for insurance brokers. This has been particularly important as the Federal Government developed regulations and other details relating to the implementation of Royal Commission reforms.”

A list of submissions that the representative body has made this year includes: Submission to the Review of the Australian Financial Complaints Authority The submissions stressed that members have indicated the need for a more robust system of triage to be adopted by AFCA to determine at a preliminary stage the exact nature of the complaint, the parties against who the complaint should be directed (the broker, the insurer, or both) and to determine the basis of the complaint.

This is important because the broking firm bears the cost of AFCA’s complaint, even when there is no real basis for the complaint against the broker. If the broking firm needs to take the matter to a decision stage in order to obtain an appropriate decision in their favour, the cost of the process is substantial, and is often disproportionate to amount in dispute.

18 / INSURANCE ADVISER AUGUST 2021

The document also stated that it is NIBA’s view that while industry remains required to fund AFCA, there must be robust systems and processes to ensure that disputes are genuine and are not simply pursued in an attempt to strongarm financial services providers into submitting to complainants demands.

“In this regard, NIBA believes it would be useful for AFCA to provide clearer information on its website, for both consumers and financial services providers, in relation to matters that are within and outside of the AFCA jurisdiction.”

NIBA also pointed out that the AFCA Data Cube data in relation to insurance brokers indicates that a significant proportion of broker disputes are outside the AFCA jurisdiction, and this needs to be made as clear as possible for the benefit of all concerned.

The submission also indicated that NIBA would be pleased to consider an options paper from AFCA which sets out potential mechanisms and procedures which would provide a proper triage process, in a manner that was fair to all parties.

Submission on AFCA Engagement Charter This document was supportive of the creation of an Engagement Charter to provide clarity to complainants, their representatives, and financial firms as to their rights and obligations as members of AFCA or as users of AFCA’s services.

NIBA noted that the charter repeatedly states that AFCA will follow principles of fairness when making its decisions.

NIBA expressed concern that the inclusion of these terms without appropriate explanation as to their

meaning in this context could be misleading for complainants as the concept of fairness is highly subjective.

The submission also stated that to maintain transparency and faith in the charter as an agreement between AFCA, financial firms and complainants, AFCA and the Independent Assessor should publish the number of service delivery complaints they receive in relation to breaches of the charter by AFCA. NIBA also expressed support for the reporting of charter breach incidences by complainants, representatives and financial firms to reassure all participants that breaches of the charter will be appropriately dealt with.

As part of its engagement with AFCA, the NIBA Board met with AFCA Chief Executive Officer David Locke and General Insurance Ombudsman John Price at the May 2021 Board meeting. The discussion was very useful for all concerned, and it was pleasing to hear AFCA has no major concerns with the work of insurance brokers across Australia.

Submission to ASIC Guidance on Deferred Sales Model Through this submission, NIBA has reiterated its concerns with the broad catch all approach being taken by the government clear and the under or non-insurance risks to consumers that can arise.

NIBA has categorically stated that ASIC’s criteria is extremely onerous and the cost to industry of having to make such specific applications relevant to an add on insurance product sold by a specified person or a class of add on insurance products sold by a specified person, is prohibitive.

The net result is likely to be that few applications will be lodged and the risk of consumer under or non-insurance will

NEWS / Submissions

only be discovered after the fact. In NIBA’s view, this is a high-risk regulatory approach i.e., catch everything assuming they are all bad products with no evidence in support, require people to seek an exemption for a significant range of products in an overloaded and overly complex regulatory environment and gamble that a consumer will not be left uninsured where exemptions are not sought or granted.

NIBA has also expressed concern to the reference, “to reduce the number of poor-quality insurance products being sold in Australia”. At the very least, this implies that the product being sold is of a type that can be poor quality. NIBA has maintained that this is unnecessary and may be misleading to consumers and result in a negative sales effect to the detriment of the consumer.

Submission to Australian Small Business and Family Enterprise Ombudsman Insurance Inquiry (ASBFEO) In its submission, NIBA focused on the important services brokers provide to their small business clients. Highlighting that the role of the insurance broker is to act for and on behalf of the client, to help the client understand their risks and insurance needs, to prepare a recommended insurance program to cover those risks, and to access the insurance markets to get the best possible coverage for the client at the most cost-effective price. Acting in this way, the insurance broker acts as a purchaser of insurance cover on behalf of their client, not a seller of insurance cover.

The submission also pointed to the low incidence of AFCA complaints and disputes by consumers and small businesses regarding insurance brokers, the sound operation of NIBA’s self-regulatory Insurance Brokers’ Code of Practice and lack of significant consumer complaints, as evidence that brokers are operating in the interests of their clients.

NIBA also noted that a robust protection regime applies for consumers in relation to the conduct of insurance brokers at general law, the Corporations Act (2001) Cth and other relevant legislation.

There is no evidence that these mechanisms are not working.

The submission also clarified that insurance brokers also become the advocate of the client when an insured

event occurs, and a claim has to be made under the policy. NIBA maintains ongoing contact with ASBFEO in order to provide further insight into the intermediated insurance industry and ensure that the Small Business Ombudsman’s Office has a thorough understanding of the important role brokers play, especially in the small business space.

Submission on personal injury insurance for gig economy workers The submission acknowledged that the meteoric rise of the gig-economy in Australia has had a significant impact on the Australian economy and workforce as well as how unprepared Australia’s regulatory environment is to handle these new ways of working.

The document noted that delivery riders who work for either Uber or Deliveroo are currently covered under the company’s respective injury insurance policies.

However, the benefits available to workers and their families under these policies are significantly less than those available under the NSW workers’ compensation scheme.

NIBA stated that it believes that food delivery riders meet the requirements of a deemed worker as they are engaged by the platform for the purposes of their trade and are directed by the platform regarding the work to be performed and the time in which it is to be performed (many platforms track their delivery partners and riders may be removed from the platform if they fail to complete deliveries in what the platform deems to be a timely manner).

NIBA’s preferred option was to extend the existing workers’ compensation scheme to include food delivery riders, “This could be done by amending existing workers’ compensation regulation providing that food delivery drivers are deemed workers for the purposes of accessing workers’ compensation benefits and protection.”

Submission to the Insurance Council of Australia consultation paper on the availability and affordability of commercial insurance NIBA provided a short submission to the Insurance Council of Australia (ICA) in response to the consultation paper prepared by John Trowbridge in relation to the availability and affordability of commercial insurance in Australia. The ICA had commissioned Trowbridge to

investigate the factors giving rise to difficult market conditions and potential solutions that might be considered by insurers.

Prior to lodging the submission, the NIBA Board of Directors met with Trowbridge to discuss the state of the market and to examine in detail many of the issues raised in the consultation paper.

The NIBA submission acknowledged the role of underwriters to correctly assess the nature of risks being submitted for their consideration, but also suggested underwriters give greater consideration to providing cover for clients with good claims experience. NIBA also suggested the importance of insurance brokers being able to communicate with underwriters to discuss the client’s circumstances and their commitment to risk management and the avoidance of claims.

Submission to the Treasury Taskforce on the proposed Cyclone Reinsurance Pool for Northern Australia NIBA has provided a submission to the Treasury Taskforce preparing recommendations to the Government in relation to the proposed cyclone reinsurance pool for northern Australia.

NIBA has stressed the importance of achieving a greater number of insurers actively participating in the insurance markets in northern Australia, but particularly in Far North Queensland. The submission also urged the examination of options likely to achieve a material reduction in premiums payable by policyholders and property owners in northern Australia.

NIBA CEO Dallas Booth has been appointed to an expert panel advising the Treasury Taskforce, and will be able to provide the Taskforce with firsthand information from “on the ground” insurance brokers in relation to the operation of insurance markets in northern Australia.

YOU CA N VIEW ALL O SUBMIS F NIBA’S THE ASS SIONS ON OCIA WEBSIT TION’S niba.com E: submissio.au/ ns/

NIBA.COM.AU / 19

PROFESSIONALISM / AFCA Case Study

COVERAGE MORE IMPORTANT THAN CHEAPER PRICE

This determination involved an allegation against an insurance broker that by failing to alert the client of a cheaper product (outside the range of products the broker could advise on), the broker breached its duty of care to the client and caused loss.

AFCA held in favour of the broker in these circumstances.

Background facts

The complainant represented a body corporate with residential strata insurance sourced and recommended annually in 2014-19, during which time the premiums had increased significantly.

In 2020, the broker informed the complainant that it would not be renewing the policy and that it did not have access to another insurer in the available intermediated market that would be able to offer insurance for the complainant’s building due to its age.

At the broker’s suggestion, the complainant obtained a direct quote for an alternative policy with another insurer, S, from the direct market for a lower premium.

The complainant claimed that the broker, by failing to alert him to the cheaper product sooner or advise him to seek alternative cover in the direct marketplace, had breached its duty of care and caused him significant loss. He sought the difference between the premiums paid and what would have been paid over the same six-year period for the cheaper alternative policy with S. The complainant asserted that: • he had been relying entirely on the broker to provide him with a policy to best suit his needs at the lowest price; • S’s policy was superior as the provided quote was 20 per cent cheaper and offered flood cover which was an optional add-on for an additional premium under the previous policy; • the broker had been aware of the existence of the alternative policy and that by failing to inform the complainant of the existence of this, the broker had failed to act in the complainant’s best interests; and • even if the broker had not had access to all the insurance products/companies

20 / INSURANCE ADVISER AUGUST 2021

available, the significant price difference meant that the broker should still have notified the complainant of the alternative.

The insurance broker’s case

The insurance broker submitted that: • when it had been engaged in 2014, it had made informed recommendations regarding the available cover; • subsequent renewals were also made after considering any other suitable options at that time, with the list of alternative insurers/products having been presented to the complainant with explanations as to why they were not appropriate or available; • in each renewal period in 2017-2019, the complainant had confirmed instructions to maintain the previous year’s sum insured and paid the premium; • in 2020, it had fulfilled its duty of care by doing all it could to try to arrange an alternative policy with several underwriters, all of whom declined due to the property’s age/location; • the alternative policy with S was a part of the direct marketplace that was inaccessible to the broker; • even if it could access the direct market, it would rarely recommend this as it had been historically ‘unsustainable and inconsistent’ in its offerings; the only reason it offered this was that there were no options left in the intermediary market. The broker submitted evidence that S had entered and left the market several times and only returned in 2015 so would not have been available to the complainant in 2014. It also noted that it was not clear what products/prices (if any) were on offer in the years leading up to 2020.

BY MARK RADFORD

Principal, Radford Lawyers

The broker submitted notes documenting correspondence in 2017–19, renewal documents and proof of S’s sporadic market presence.

The AFCA decision

AFCA decided for the broker because: • it had discharged its duties reasonably and professionally by canvassing the intermediary market it could access and providing a policy consistent with the complainant’s instructions; • the broker was not required to go beyond that remit to flag either the general possibility of cheaper policies being available in the direct market, or the specific existence of the alternative policy (to the extent, and at the time, it was aware of it); • although the broker could have suggested that the complainant look into the direct market if he had any concerns regarding the policy, there was no evidence to suggest the complainant held any such concerns. It was also not clear that the complainant would have conducted independent investigations in the direct market, given the broker was being used for its professional expertise and guidance; • the complainant acknowledged he knew the broker did not have access to all products/policies; and • AFCA saw nothing to indicate the broker’s actions were based on the expectation of additional financial gain or other benefit for itself; and S’s policy was not a ‘more cost-effective option’ or a ‘like-for-like option’ as the two policies were substantially different.

AFCA also noted that even if the broker had breached its duty of care, it would be unreasonable to hold it liable for the premium difference.

PROFESSIONALISM / Technology

FIVE NON-NEGOTIABLES FOR A NEW WEBSITE

You need a new website that is going to showcase your expertise and position you as a trusted, professional brand. But have you thought about what else it must do?

T

o represent your insurance broking business, your website needs to blend sleek design with brilliant user-experience and effective lead generation tools. It must balance the needs of your business with those of your customers. And it needs to deliver on all these fronts – long term.

Jason Toyer is the Director of Codex Digital, a digital agency with specialised knowledge in financial services. Here, he shares five non-negotiables that will help guide you through any website re-design.

Think beyond your marketing needs

The first step in any website redevelopment is to clarify what your business requires from a new site.

Sounds straightforward, right? Not always. Every business unit within your organisation will have distinct needs for the new website. However, it is usually the marketing team who selects and briefs a website designer.

In our experience, a conversation about how to tie everyone’s needs together is crucial. And it’s overlooked way too often. Or if it is discussed, it can feel overwhelming trying to balance all the competing priorities. A good digital agency will make this process easy for you and they will have the expertise to understand how to bring it all together.

Let data drive decisions

So now you understand what your business requires from a new website. Great start.

But that is only half the story. Your target customer must also take centre stage. It is dangerous to base your creative and design decisions on personal preferences and

opinions alone. Data and the principles of user experience (UX) have a big role to play too. When we design and build websites, we look at any data available using common tools such as Google Analytics.

By analysing every metric, we can see what works and what does not within a few hours, eliminating the guessing game.

Build strong walls – firewalls, that is

What does Alcatraz have in common with your website? Extremely high security.

Or at least, that should be your goal.

Following the Hayne Royal Commission, the new legislation being rolled out will have major implications for Australian Financial Services (AFS) licensees.

From 1 October 2021, if your website is significantly breached, you must report to the Australian Securities & Investments Commission (ASIC) within 10 days. Plus, you will also need to notify your clients of the breach. But it doesn’t end there.

You’ll also have to investigate and quantify any loss or damage suffered – and may need to compensate affected clients.

So, is your website security not up to scratch? Now is the time to act.

Find an agency you want to stay with – long term

Trust, transparency, and understanding are important in any relationship. This includes the one you are going to have with your digital agency. Although it is tempting to outsource overseas or choose the cheapest local freelancer, you need to think beyond the upfront financial investment. If you decide to go down the road of cost before quality, be prepared for miscommunication,

JASON TOYER

Director, Codex Digital

unreliable support – and a poorly built website. Ultimately? That cheap initial outlay may end up costing you a lot more in the long-term.

And think about what you want from your website into the future.

Technology is rapidly evolving and becoming a critical asset for any business looking to ramp up. So, find an agency that can help your business move quickly and remain agile.

Remember: your website is not a silo Quite often digital assets are built up separately over time. A client relationship management system (CRM) here. A content management system (CMS) there.

Email marketing hosted over there.

Your digital assets are not going to magically come together if you don’t consider how to integrate them from the outset. If you end up with a plethora of systems that don’t ‘talk’ to each, your operations will become clunky and inefficient.

Your email list will be constantly out of date. Leads will slip through the cracks. And your people will have a lot more manual work to deal with. A website is a holistic experience, so when choosing a provider, do not just base your decision on their design portfolio.

Ensure they have the technical knowhow to integrate your new site with the tools and systems you are already using.

Make sure they build you a sales funnel that nurtures new leads and that they have set up the security features which are vital to your website. Finally, make sure your agency has the infrastructure to support you as the business grows.

NIBA.COM.AU / 21

PROFESSIONALISM / Back to Work

UNCERTAIN TIMES – NAVIGATING A SUCCESSFUL RETURN TO WORK

Moving forward, a proportion of organisations will continue to allow workplace flexibility, although there will still be an expectation that some work time is actually conducted back in the office.

I

f there ever was a silver lining to the global pandemic, it’s that we have been able to step back and physically remove ourselves from the hectic, fast-paced business life and work from home.

Depending on which Australian state you live in, there has been some ease in restrictions and with the economy improving, many businesses are now requesting that employees return to their working environments. While many workers enjoyed the freedom and flexibility of being at home, many others reported that they found it isolating and negatively impacted their emotional wellbeing. The lack of face-to-face engagement robbed employees of the chance to build essential workplace relationships and socially interact.

It has been suggested that in the future, approximately three quarters of people would like to return to work at some stage using a hybrid model, while one quarter would prefer to return fulltime. Either way, returning to work after an extended period working remotely may be difficult for some employees and bringing workers back will not be as simple as turning on a switch.

Team members may continue to be experiencing feelings of vulnerability, concerned with social distancing and being hyper aware of becoming ill.

It is inevitable then that such feelings will generate a sense of nervousness and apprehension about returning.

With these considerations in mind, it will be essential from an employer perspective to demonstrate empathy and understand that, for some, the thought of coming back to work may be met with trepidation.

To successfully meet such concerns, businesses will have to ensure that a safe

22 / INSURANCE ADVISER AUGUST 2021

and well-planned-out return to work program is implemented to achieve the best outcome for all.

Interestingly, a number of companies have surveyed employees to fully appreciate and understand what their experiences have been thus far both personally and professionally. What did they enjoy? What did they find most challenging? What would they like to see moving forward? These surveys have afforded workers a voice with which to express their feelings, open lines of communication and provide valuable feedback that will assist leaders to create a more predictable and stable work environment.

Additionally, the transitional phase can be a real opportunity for organisations to identify what they want their future business model to look like and take the necessary steps to accomplish this. What is inevitable, though, is the fact that things will probably not be conducted in the same way as they were prior to COVID-19.

Here are some practical tips to ease the process: Communicate your commitment to health and safety: Employees will want to feel safe in the knowledge that you have addressed health concerns and mitigated risks. This should include social distancing rules, reduction in ‘hot desk’ usage, sanitiser and protocols around the use and cleaning of shared areas such as kitchens etc.

Stagger work start and finish times: This will allow workers to commute outside of peak times and reduce the number of people

NIKKI HEALD

Managing Director, Corptraining

within the office space and using lifts during standard business hours.

Provide support to maintain mental health wellbeing: Leaders must take responsibility and create a culture that is designed to take away any stigma that may be attached to mental health. Additionally, undertaking relevant training and engaging in regular dialogue with the team helps to foster an environment that allows people to feel comfortable sharing how they feel.

Take a considered approach: It may well be that after due consideration and prioritisation, not all teams will be required to return. Depending on their function within the business, some employees may be able to continue working from home for a longer period than others.

Maintain regular connections: During COVID-19 the communication between companies and workers increased using platforms such as Zoom, MS Teams and Skype. This increase was aimed at reducing social isolation and providing support and should be continued even after staff have transitioned back to work.

There is no doubt that we are and will continue to be working within a world that is filled with uncertainty and everpresent change. Ultimately, though, reorienting your team into the office requires a measured and considered approach, designed to successfully meet the expectations of the individual while maintaining business continuity.

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ANALYSIS / Legal

‘TESTING’ FOR COVID-19: ONE DOWN, ONE TO GO

As the quest to ascertain the extent to which business interruption losses are covered by insurance continues, it is useful to reflect on the current position, both at home and abroad.

BY CLANCY O’DONOVAN

Senior Associate, DLA Piper Australia

O

n 25 June 2021, the High Court of Australia refused an application for leave to appeal filed by the insurers involved in the Quarantine Act Test Case. The High Court’s decision brings an end to the proceedings, which were commenced in August 2020 at the instigation of the Insurance Council of Australia (ICA) and the Australian Financial Complaints Authority (AFCA).

The principal purpose of the proceedings was to determine whether references in exclusion clauses to diseases “declared to be quarantinable diseases under the Quarantine Act 1908 (Cth) and subsequent amendments” should be read as including COVID-19.

On 18 November 2020, the NSW Court of Appeal delivered a decision in favour of the policyholders, concluding that exclusion clauses of this nature do not include diseases such as COVID-19, being a ‘listed human disease’ under the Biosecurity Act 2015 (Cth) (Biosecurity Act).

The High Court’s recent refusal of the insurers’ application for leave to appeal effectively means the NSW Court of Appeal’s decision stands and there are no further avenues of appeal to be pursued.

So, what does the conclusion of the Quarantine Act Test Case mean for policyholders and insurers? This question must be considered in the context of both the scope of the Quarantine Act Test Case itself and also the nature of the Second Test Case, which is presently before the Federal Court of Australia.

The Quarantine Act Test Case was designed such that it had a relatively narrow purpose – to test the application, or otherwise, of an exclusion clause containing a particular form of wording. If the case had been decided in the insurers’ favour, the

24 / INSURANCE ADVISER AUGUST 2021

decision may well have provided a complete answer to many policyholders’ claims.

However, having been decided in favour of the policyholders, it does not conversely have the same effect and it is believed that the decision is unlikely to have any significant immediate impact in terms of the payment of claims by insurers. This is because in many policies there remain other fundamental issues requiring determination in order to resolve the ultimate question of whether cover is available. Such further issues include: • firstly, whether losses sustained as a consequence of the pandemic and associated government actions enliven the particular insuring clauses in each policy. This issue is likely to involve consideration of a variety of sub-issues including, for example, the operation of provisions which depend on disease in a specified area in proximity to the insured premises; • secondly, whether any other exclusion clauses may apply – including, for example, exclusions which refer to diseases listed pursuant to the Biosecurity Act (as COVID-19 now is); and • thirdly, if cover is available, how policyholders’ losses are to be adjusted.

This issue will require consideration of, among other things, the extent to which account should be taken during the adjustment process for losses which would have been caused by the pandemic

in any event, regardless of the imposition of restrictions or other measures.

These issues, among others, are expected to be considered in the Second Test Case, which has also been developed

by ICA and AFCA. The Second Test Case is listed for first instance hearing in the Federal Court commencing on 30 August 2021, with any appeal to be heard by the Full Court in November 2021.

In addition to the test cases organised

by ICA and regulators, other litigation has recently been commenced on behalf of businesses seeking cover for losses associated with the pandemic.

In May 2021, it was announced that proceedings had been filed in the Supreme Court of Victoria by operators of hospitality venues which had been impacted by the pandemic and various restrictions imposed in Victoria.

Additionally, in July 2021, the commencement of class action proceedings in the Federal Court on behalf of policyholders was publicised. The policyholders seek declarations that they are entitled to cover under their respective policies, together with damages for consequential losses they have allegedly incurred.

With the Quarantine Act Test Case having reached its final destination, the next major ‘milestone’ on the horizon is likely to be the Federal Court’s delivery of a first instance judgment in the Second Test Case. This judgment is expected to be handed down in October 2021.

“In many policies there remain other fundamental issues requiring determination in order to resolve the ultimate question of whether cover is available.”

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COMMUNITY / NIBA Convention

#NIBA2021: It’s like nothing you’ve experienced before The 2021 NIBA convention is shaping up to be the insurance broking event of the year featuring exclusive insights, inspirational speakers and unparalleled networking opportunities.

BY TANAYA DAS

An invitation from Dianne Phelan

O

n behalf of the National Insurance Brokers Association (NIBA) and the Convention Committee, it is my pleasure to invite you to the 2021 NIBA Convention, which is to be held from 28 September to 28 October 2021.

This year we had planned to bring the insurance broking profession together and deliver a national face-to face Convention. However, with the continuing uncertainty of the COVID-19 outbreak and adoption of border restrictions, a full face-to-face Convention has been difficult to implement at this time. In the meantime, we have noted the need for members to stay up-to-date on a wide range of issues, challenges and market developments. We are therefore pleased to finally reveal the behind-the-scenes work of our Convention Committee.

Therefore, in 2021 NIBA will deliver the Convention in both a virtual and face-to-face format. From Tuesday 28 September through to Thursday 28 October, NIBA will visit Perth, Adelaide, Melbourne, Brisbane and Sydney.

Delegates will have the opportunity to interact face-to-face and attend the Convention in their home state, while also accessing the entire national

26 / INSURANCE ADVISER AUGUST 2021

program virtually. NIBA has engaged a dedicated team of designers, developers and producers to deliver an unparalleled delegate experience using a customised virtual convention platform.

Delegates of the 2021 NIBA Convention will not only have access to a range of face-to-face as well as virtual presentations, discussions and information sessions, but will also be able to engage with insurers, underwriters and other exhibitors in their home state. Furthermore, delegates will have the ability to engage with each other virtually, as they normally would at a national convention.

This year the theme is Professionalism + Resilience = Opportunity. The NIBA events team has been hard at work designing a program that will inspire, challenge and prepare brokers for the uncharted waters ahead.

Brokers can expect to hear from thought leaders within and outside the insurance broking profession, practical workshops that will challenge and inspire, regulatory updates, thoughtprovoking plenary sessions and a marketplace inclusive of insurers, underwriters and industry partners.

Intermediaries will have an opportunity to reinforce their role as valued partners

to both insurers and clients in the current landscape, and this Convention provides the tools to do so.

As per previous years, the convention will also celebrate the best in broking talent by announcing the winners of the prestigious Lex McKeown Trophy, the QBE-sponsored Stephen Ball Memorial Award for Broker of the Year and the Vero-sponsored Warren Tickle Memorial Award for Young Professional Broker of the Year. The General Insurer of the Year awards, chosen by brokers, will also be announced at the conference.

NIBA Convention is the only event on the convention schedule that truly brings the entire insurance community together regardless of cluster group allegiances, brokerage size and reach, and professional experience. We meet to celebrate, to learn, to build relationships and, of course, to have a good time.

We have kept pricing highly competitive, with an all-access early bird pass starting at $385 (incl. GST) for members. Early bird registrations are now open, but for a limited time, so do not delay.

To register, or for further information, please visit niba.com.au/convention.

Wherever you are in Australia, we do hope you will join us.

“NIBA Convention is the only event on the convention schedule that truly brings the entire insurance community together regardless of cluster group allegiances, brokerage size and reach, and professional experience.

We meet to celebrate, learn, build relationships and, of course, have a good time.”

COMMUNITY / NIBA Convention

A scintillating array of speakers

The current industry challenges will be addressed by the following line-up of speakers.

MARK CARTER With over two decades as a learning and development professional and building frameworks for blue-chip billion-dollar companies and SMEs, Mark Carter knows a thing or two about human behaviour. Author of Add Value, he knows how to connect and get the best out of people. He understands that the secret to wealth for every business lies with its key assets: its people.

MICHAEL GILL Michael Gill is recognised as one of the leading lawyers in the field. For many years he was the principal lawyer for NIBA and many of its members. He was instrumental in the drafting of the original Code of Practice and has represented insurance brokers in professional indemnity, regulatory and compliance matters.

MARK RADFORD

With over 25 years’ experience in the insurance and financial service industry, Mark Radford advises the insurance industry (insurers, reinsurers, insurance agents, brokers) and other financial services industry participants on the many legal issues affecting the operation of their businesses – in particular policy drafting and interpretation and regulatory compliance in relation to legislation affecting their business. He is widely recognised as one of the few experts in FSR and was on the Government Financial Services Advisory Disclosure panel, the Government FOFA Peak Consultation Group and Government Roundtable Consultation Group on Unfair Contracts and Insurance.

28 / INSURANCE ADVISER AUGUST 2021

DALLAS BOOTH Dallas Booth is Chief Executive Officer of NIBA and has been in this role since July 2011. Booth leads NIBA’s industry representation efforts and promotes the role and professionalism of insurance brokers to governments, regulators, businesses and the broader community.

DIANNE PHELAN NIBA’s President, Dianne Phelan, has been an insurance broker for more than 30 years. After initially forming Morris Lloyd Insurance Brokers with two other colleagues, the firm joined Victorian brokerage BJS, which was expanding into other states and now has nine offices across Australia.

WARD DEDMAN Ward Dedman is Chief Executive Officer and Executive Director of the EBM Group with over 25 years of extensive experience in the insurance industry having previously worked for major insurance companies and insurance brokers prior to joining EBM in 2000.

NIKKI HEALD Nikki Heald is the Director of Corptraining, established to provide dynamic and modern presentations appropriate to the business needs of today. Her programs focus on developing interpersonal skills which enhance business relationships and professional visibility, resulting in increased credibility and sales.

Meet some of your MCs around the country Christina Morrissy is set to play Master of Ceremonies to kick off the Convention in Perth. She is both a familiar face and voice to Western Australians, having presented on TV and radio for the better part of two decades.

Morrissy is a media broadcaster, print journalist and social media content generator with more than 20 years’ experience in identifying and getting the message across.

Jordana Borensztajn will be welcomed to Crown Melbourne as the Master of Ceremonies.

In this crazy world of hashtags, likes, algorithms and selfies, it is more important than ever to understand the true value of human connections. And that’s exactly what makes the incomparable Borensztajn tick.

A consummate communicator and a master of the art of personal connection, Borensztajn channels her multitalented background as a journalist, comedian and lion tamer in Africa to craft a uniquely comedic perspective on absolutely everything in life that matters, particularly how different generations connect.

Andrew Klein returns to NIBA Convention following popular demand to MC the final leg of the journey in Sydney.

A former corporate lawyer, Klein quit the law in the late ’90s before starting up his own business as a corporate trainer and speaker. As an MC, he brings his casual yet corporate style to proceedings and is well-known on the conference circuit for his revealing speaker introductions, his improvisational skills and ability to adapt to different audiences.

COMMUNITY / NIBA Convention

Program highlights

A celebration of excellence

#NIBA2021 is set to deliver yet another jam-packed program to equip insurance brokers with the skills and knowledge to thrive during a critical time for the insurance broking profession.

The regulators – AFCA, ASIC and the IBCCC – will return to the Convention stage for the ever-popular “Meet the Regulators” session, while NIBA CEO Dallas Booth and NIBA’s legal adviser, Mark Radford, will explain five major areas of the Royal Commission reform.Delegates can also expect a “State of the Industry” panel, a discussion on the 2022 General Insurance Remuneration Review, and much more.

The 2021 NIBA Convention is also set to celebrate the very best in broking with the QBE-sponsored Stephen Ball Memorial Award for Insurance Broker of the Year, the Vero-sponsored Warren Tickle Memorial Award for Young Professional Broker of the Year, and the Lex McKeown Trophy for outstanding contribution to the industry.

A National Awards Ceremony will be held in Sydney, at which time insurer performance will also be acknowledged, with the General Insurer of the Year and Underwriting Agency of the Year announced.

DATES FOR THE DIARY Perth, Western Australia 28 September 2021 Adelaide, South Australia 5 October 2021 Melbourne, Victoria 12 October 2021 Brisbane, Queensland 19 October 2021 Sydney, New South Wales 28 October 2021

SPONSOR OR EXHIBIT AT #NIBA2021 To discuss sponsorship and exhibition opportunities, please contact us:

Helen McGowan Waldron Smith Management T: 03 9645 6311 E: helen@wsm.com.au

Tony May

EARLY BIRD PRICING AVAILABLE FOR A LIMITED TIME: ALL-ACCESS PASS STARTING AT $385 FOR MEMBERS

An experience unlike any other, #NIBA2021 will take the Convention Expo Hall into a whole new dimension. It is a great opportunity to learn about the latest cutting-edge products and services that will take your business forward.

REGISTRATION FEES TYPE

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NON-MEMBER

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THANKS TO OUR PRINCIPAL SPONSORS

NIBA.COM.AU / 29

COMMUNITY / #NIBA2021

A GUIDE TO #NIBA2021 The 2021 NIBA Convention is just around the corner, taking place 28 September – 28 October, 2021. Here’s what delegates can expect.

PERTH, 28 SEPTEMBER 1–2pm 2–2:30pm 2:30–3pm

Opening Keynote Insurance Brokers and Workers’ Compensation System COVID-19 Related Business Interruption Claims and Test Cases

ADELAIDE, 5 OCTOBER 1-2pm State of the Industry 2021 2-2:30pm 2022 General Insurance Remuneration Review 2:30–2:45pm Introducing Technology to Streamline Claims 2:45–3pm DDO and Technology to Keep Up with Regulatory Burden MELBOURNE, 12 OCTOBER 1–1:15pm 1:15–1:30pm 1:30–1:45pm 1:45–2pm 2–2:30pm 2:30–3pm

Future of Financial Services Regulation Meet the Regulators: ASIC Meet the Regulators: AFCA Meet the Regulators: IBCCC Working Practices Post-COVID-19 Working Practices Post-COVID-19

BRISBANE, 19 OCTOBER 1–1:20pm 1:20–1:40pm 1:40–2pm 2–2:20pm 2:20–2:40pm 2:40pm–3pm

Storm, Floods, Fires: Insurance for Weather-related Incidents Storm, Floods, Fires: Insurance for Weather-related Incidents Storm, Floods, Fires: Insurance for Weather-related Incidents Northern Australian Cyclone Reinsurance Pool: Perspective from ARPC Northern Australian Cyclone Reinsurance Pool: Perspective from Insurers Northern Australian Cyclone Reinsurance Pool: Perspective from Brokers

SYDNEY, 28 OCTOBER 1–2pm 2–2:45pm 2:45–3pm

NIBA National Award Ceremony Closing Keynote Convention Close

30 / INSURANCE ADVISER AUGUST 2021

COMMUNITY / #NIBA2021

2021 NIBA Convention

PROFESSIONALISM + RESILIENCE = OPPORTUNITY

28 September Perth 5 October Adelaide

12 October Melbourne 19 October Brisbane 28 October Sydney THANKS TO OUR PRINCIPAL PARTNERS

NIBA.COM.AU / 31

FEATURE / A&H Insurance

32 / INSURANCE ADVISER AUGUST 2021

Triple zero: Accident and health insurance There is nothing quite like a global health crisis to shake up the accident and health sector.

BY NINA HENDY

NIBA.COM.AU / 33

FEATURE / A&H Insurance

H

ealth fears, border closures preventing overseas travel and growing mental health issues among Australians present new opportunities for brokers to better respond to changing consumer needs.

Meanwhile, the pandemic has brought the need for comprehensive cover to the forefront of people’s minds.

In fact, a report comparing 7,000 survey responses in 2020 and 2021 reveals that more than a third of respondents felt underinsured for potential income protection loss resulting from disease, long-term disability, or death of a main household bread-winner.

The Swiss Re Group’s report, COVID-19 consumer survey 2021: views of insurance in Asia Pacific one year on, also exposes a big shift in consumer sentiment. Policy price is no longer the primary factor in policy choice; consumers are reading the fine print to better understand the width and scope of cover.

It means that the pandemic has rattled consumers, who will be looking more closely at cover inclusions when purchasing a policy.

34 / INSURANCE ADVISER AUGUST 2021

FRESH THINKING NEEDED

“AT THE END OF THE DAY, THE PANDEMIC TRULY HAS HIGHLIGHTED THE NEED FOR APPROPRIATE LEVELS OF COVER, AND WE’RE SEEING THE MARKET DRIVING DEMAND FOR MORE COMPREHENSIVE INSURANCE PRODUCTS.”

Steve Ord is the newly appointed Executive General Manager at speciality underwriting agency AHI. He has extensive experience in the accident and health sector, working for both major insurers and brokers throughout his career.

Ord is looking for innovative ways to drive growth in what is a competitive Australian landscape that’s estimated to be worth around US$1.2 billion.

He raises concerns about the reduction in scope and offerings within the sector.

“We’re saddened to see a reduction in the scope and offerings for accident and health by some industry players, but equally buoyed by the fact that our commitment to sustainable pricing for our high-value product suite has allowed us to continue to offer market-leading cover,” Ord says.

“At the end of the day, the pandemic truly has highlighted the need for appropriate levels of cover, and we’re seeing the market driving demand for more comprehensive insurance products.”

Ord says its not a case of looking for new client opportunities within this sector, but rather encouraging brokers to focus on existing customers to ensure they have the right level of cover.

In response to the pandemic, AHI removed all mental health exclusions across its product suite – something that has become a required feature for organisations during the pandemic.

“Whether that’s a review of the coverage, benefits or limits offered by incumbents, or looking at ensuring no gaps in clients’ exposure, such as journey coverage policies where statutory cover isn’t available,” he says.

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FEATURE / A&H Insurance

OPPORTUNITIES REMAIN

The Vice President of Accident and Health for Australia at Liberty Specialty Markets, Richard Todd, believes that the big growth opportunities lie in the group personal accident and sickness space. “COVID-19 has presented brokers and insurers with the opportunity to further understand client needs, and by listening with empathy during these tough times, we’re having good conversations with clients on their evolving needs,” Todd says.

Liberty is also looking for growth opportunities among employers, schools, universities and sports clubs. In the long-term, as travel opens more broadly, the portfolio will grow, he says. “The health and wellbeing of people is such a critical issue, and it’s important to have a full understanding of the covers available and ensure the right breadth of benefits for employees and clients. Brokers who are across workers’ compensation, life and general products in accident and health are best placed to support their clients,” Todd says.

HYBRID WORKFORCE

The move to flexible work arrangements is one of the most common topics Liberty is being asked about, Todd says.

“The traditional physical office is being mixed with the home office, and

36 / INSURANCE ADVISER AUGUST 2021

“BROKERS WHO ARE ACROSS WORKERS’ COMPENSATION, LIFE AND GENERAL PRODUCTS IN ACCIDENT AND HEALTH ARE BEST PLACED TO SUPPORT THEIR CLIENTS.”

FEATURE / A&H Insurance

are increasingly relying on accident and health policies to offer protection from sickness, accidents and injuries.

“And while COVID-19 has caused challenges in the travel space with contractions in premiums and clients, there are opportunities to refine and re-develop domestic travel offerings,” Todd says.

Ord agrees. While travel markets have shrunk and companies are looking to cut costs through premium reductions, there have been increases across group personal accident and sickness portfolios, including enterprise bargain agreement programs.

“Brokers would be well placed to look for opportunities around income protection, where group personal accident programs have become a very viable alternative as life insurance premiums have risen,” Ord says.

GLOBAL INSTABILITY

However, instability in the global economy is a concern, according to Ord. “I don’t think we’re alone as an industry or business in the challenge faced in an unstable economy. For insurers in the

FIVE THINGS BROKERS SHOULD BE AWARE OF 1 Agility: Protection needs to become more agile 2 Instability: Instability in the global economy is a key challenge 3 Opportunity: Opportunities to develop new offerings in the domestic travel market 4 Inflexible work: Income protection cover provides an opportunity for brokers 5 Border closures: Travel cover renewals have fallen dramatically

38 / INSURANCE ADVISER AUGUST 2021

“AND WHILE COVID-19 HAS CAUSED CHALLENGES IN THE TRAVEL SPACE WITH CONTRACTIONS IN PREMIUMS AND CLIENTS, THERE ARE OPPORTUNITIES TO REFINE AND REDEVELOP DOMESTIC TRAVEL OFFERINGS.”

corporate and leisure travel markets, this has meant a shrinking of the available premium pool and in some ways, an increase in claims and claim values.”

However, strong industry experience enables AHI to generate value and manage costs to maintain comprehensive cover, he says. “AHI has always strategically balanced our portfolio between travel and personal accident and sickness products, and while we saw a reduction in travel cover renewals due to travel restrictions during the pandemic, we equally saw strong domestic demand for group and individual personal accident and sickness cover,” Ord says.

Insurers and governments are looking to ensure that the accessibility of protection is aligned to the current evolving social-economic environment and the new nature of work, Ord adds.

“In other words, protection needs to become more agile. Our claims and underwriting teams work side-by-side, and our strategic partnerships are designed to ensure full-circle feedback.”

“OUR CLAIMS AND UNDERWRITING TEAMS WORK SIDE-BY-SIDE, AND OUR STRATEGIC PARTNERSHIPS ARE DESIGNED TO ENSURE FULL-CIRCLE FEEDBACK.”

NIBA.COM.AU / 39

FEATURE / Workers’ Compensation

A PARTICULARLY COMPLEX WEB

The workers’ compensation space has faced its challenges over the past few years, even setting aside the issues facing the segment in the post-COVID-19 world.

BY ROSALEA RYAN

40 / INSURANCE ADVISER AUGUST 2021

NIBA.COM.AU / 41

FEATURE / Workers’ Compensation

I

nsurance brokers at Mildura in the jurisdictions all have different benefit far north-western corner of Victoria, structures and different eligibility criteria where three states meet, and in the for assessing entitlement,” he says.

Gold Coast–Tweed region on the “This is particularly confusing and Queensland–New South Wales border, frustrating for multi-state employers to take just two examples, are likely to where injured employees are paid different have clients operating under two or more compensation benefits for the same versions of workers’ compensation and injury, depending on where they reside. work health and safety (WHS) legislation.

“It’s also recommended that Others might be overseeing policies in employers seek advice from their broker several jurisdictions for the same client, in regard to what remuneration needs be that a mining company with sites in the to be declared and to ensure the correct Pilbara and Central Queensland, a retailer industry classification has been applied. with warehouses and stores throughout the “Brokers and employers should be aware major cities, or a manufacturer with several that there are alternative premium options small plants dotted around the country. available in some jurisdictions, depending With almost a dozen variations across Australia, keeping up with workers’ compensation and WHS obligations calls for vigilance and continual monitoring by both brokers and their employer-clients.

This complexity can create challenges and red tape for brokers who need to have access to multiple insurance schemes and knowledge of diverse WHS laws and standards.

Across the board, it is a statutory requirement throughout Australia that every employer has workers’ compensation insurance in place in every state or territory in which it has employees located. A business operator may also need to provide coverage for some or all of their contractors even if they are not considered employees for taxation purposes.

The aim is to guarantee that every worker is insured in the event that they suffer an injury or – more importantly, with the SARSCoV-2 pandemic still active – a disease while working.

Beyond these most basic obligations, however, the fine print diverges slightly.

Gary McMullen, Director of Workplace Risk at Aon, says the geographic fragmentation can be demanding. “Up to 11 different workers’ compensation – GARY MCMULLEN, AON

“It’s particularly confusing and frustrating for multi-state employers where injured employees are paid different compensation benefits for the same injury, depending on where they reside.”

42 / INSURANCE ADVISER AUGUST 2021

on the amount of risk employers want to retain and what they want to transfer to an insurer. A broker will be able to undertake premium modelling and analysis to determine the best options available.”

McMullen says the cost to multi-state employers of managing the duplication of effort and compliance “runs into tens millions of dollars” annually – “and this does not take into the account the unfairness and inequality that currently exists across the Australian workers’ compensation landscape with regard to the different compensation benefits”.

“Due to the cost pressures on business post-COVID-19, Aon would support

BY INDUSTRY, FOR INDUSTRY re-opening the debate at the federal level around the benefits to business of introducing a national workers’ compensation scheme,” McMullen says.

He says self-insuring in the Comcare scheme “is often seen as the optimum outcome for large national employers”.

“While the entry criteria appear to have been set at a high bar, our experience is that the federal government is open to new industries joining Comcare as long as they are eligible.”

In New South Wales, South Australia and Victoria, insurers operate as agents on behalf of the respective state authorities, while in Tasmania, Western Australia,

In Western Australia, an educational tool created in collaboration with industry and almost five years in the making is helping brokers to stay abreast of workers’ compensation.

“Brokers who wish to learn more about the WA workers’ compensation and injury management scheme can register for the online Insurance Brokers Education Program,” WorkCover WA CEO Chris White says.

“Developed in collaboration with NIBA WA and the Insurance Council of Australia WA, this consists of modules designed to inform and guide brokers’ knowledge. On completion, brokers will have gained an understanding of their role in the scheme and the claim management process.”

NIBA WA Divisional Chair (and Regional Director – Broking at EBM) Clint Jeuring says it’s important that brokers of all levels of experience be supported in handling workers’ compensation as this is the biggest insurable risk by cost for most Western Australian businesses.

“Given the Workers’ Compensation Act in Western Australia does not specifically recognise the role of brokers, our continued commitment to high levels of professionalism is critical in demonstrating to WorkCover WA and the licensed insurers the critical value and support brokers offer clients,” Jeuring adds.

The program is accredited by both NIBA and the Australian and New Zealand Institute of Insurance and Finance, allowing participants to receive continuing professional development points.

Completing all three courses costs $130 for NIBA members.

Visit: nibawa.learnupon.com

the Northern Territory, Queensland and the Australian Capital Territory, they privately underwrite public schemes.

In NSW, this insurance and its related care services are provided to more than 326,000 employers and 3.6 million employees by the government agency icare. icare Broker Manager Rizwan Haque says brokers play an important role in the workers’ compensation scheme and it’s essential that both the employer and their broker complete the icare letter of appointment. “This ensures brokers are able to access all the information they require tobest support their customers,” Haque says.

“In supporting their custmers, brokers should ensure the employer’s policy is correctly classified and the employer understands their obligations under the relevant Acts, understands the value of prevention, promotes recovery-atwork, and understands what support services are available to help prevent workplace injury and manage claims.”

He encourages clients to establish an effective working relationship with their claims provider before any potential incident occurs. “Employers and their brokers shouldn’t wait for a claim to happen before understanding how to best work with claims service providers in supporting a safe and sustainable recovery for their workers and to ensure they control the cost of insurance,” he says. icare has announced that a new tender will be issued for workers’ compensation claims providers under the Nominal Insurer in NSW. Details are expected to be made available later this year.

NIBA.COM.AU / 43

FEATURE / Workers’ Compensation

“Employers and their brokers shouldn’t wait for a claim to happen before understanding how to best work with claims service providers in supporting a safe and sustainable recovery for their workers and to ensure they control the cost of insurance.” – RIZWAN HAQUE, ICARE

CLAIMS BEYOND THE PHYSICAL

“WA is fortunate to have an extremely effective workers’ compensation and injury management system,” WorkCover WA CEO Chris White says. “It’s privately underwritten by insurers and requires a number of different groups and individuals to interact and operate in a professional and effective manner.

“Here the brokers’ code of practice has been developed by WorkCover WA in consultation with NIBA and the industry more broadly to promote effective interaction between insurance brokers, employers, insurers and WorkCover WA. “Brokers assist employers to meet their legal obligations and negotiate fair and reasonable terms with insurers and should represent clients to the best of 44 / INSURANCE ADVISER AUGUST 2021

their ability by collecting all necessary risk information for underwriters. Brokers must be careful not to impede stakeholder compliance and employers should be aware that brokers cannot provide legal advice.”

White says brokers should ensure clients’ workers’ compensation insurance policies are up to date. “An employer risks being prosecuted for not having a current policy, and delays in reporting a new or renewed policy to WorkCover WA for monitoring purposes may trigger an investigation.”

WA is at present rewriting its workers’ compensation legislation and expects to release an exposure Bill for public consultation before the end of this year. “The goal is to

In recent years, workers’ compensation claims resulting from psychological injuries have been on the rise, icare Broker Manager Rizwan Haque says.

Haque says this has been apparent across both the private and public sectors in his state, NSW. “It’s a critical trend due to the complexity of psych claims, in which treatments can be more costly and good return to work outcomes more difficult to achieve,” he says.

“We’ve noticed psychological claims tend to commence weekly benefits earlier than non-psych claims and also stay on weekly benefits for longer.”

FEATURE / Workers’ Compensation

FIVE KEY TAKEAWAYS As economies tighten, more employers are considering selfinsurance in either a state/territory scheme or in Comcare. “Eligible employers can save up to 30 per cent of their national premium spend by self-insuring rather than paying higher up-front and in some cases non-refundable premiums,” Gary McMullen says.

While brokers help clients to meet their legal obligations, they cannot provide legal advice as such.

Each jurisdiction has made its own determination on whether JobKeeper payments must be included in or excluded from employee wages for the purpose of calculating insurance premiums.

Brokers play a pivotal role on behalf of clients in negotiating fair and reasonable terms with insurers.

Five states or territories have already adopted or are in the process of developing industrial manslaughter legislation, allowing for the prosecution of individual officers and/or business entities.

deliver a modern Act which is clear, accessible and workable,” White says.

In South Australia, workers’ compensation insurance premiums had dipped to an all-time low of 1.65 per cent before being forced back up to 1.70 per cent by an escalation in claims meeting the serious injury threshold. “The board and management of ReturntoWorkSA take any premium increase very seriously and have kept this to a minimum,” ReturntoWorkSA Chair Greg McCarthy says.

At the same time, ReturntoWorkSA is actively pursuing and where appropriate prosecuting dishonest claims in order to protect the scheme against fraud, McCarthy says.

In Victoria – the state worst affected to date by COVID-19 – WorkSafe Victoria has published information on 46 / INSURANCE ADVISER AUGUST 2021

the virus for brokers and employers in 15 community languages. Brokers can support clients by highlighting the need to immediately notify WorkSafe of any workplace COVID-19 exposure.

As the WHS landscape continues to evolve, Gary McMullen says one of the biggest changes has been the introduction of industrial manslaughter legislation in the ACT, Queensland, Victoria and the NT and the passing of a Bill to pave the way for such a law in WA. “In WA, the maximum penalty for an officer is 20 years’ imprisonment and a fine of $5m, while the maximum penalty for a body corporate is a fine of $10m,” McMullen says. “A broker can provide advice and support to officers to ensure they are aware of their duty under the legislation to proactively exercise due diligence.”

“Brokers must be careful not to impede stakeholder compliance and employers should be aware that brokers cannot provide legal advice.”

CHRIS WHITE, WORKCOVER WA

“QPIB represents competence and the will to strive for excellence.”

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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

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QPIB – A STATEMENT OF PROFESSIONALISM

• QUA L

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NCE BR

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COMMUNITY HUB

COMMUNITY HUB AUGUST 2021

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

INDEX AB Phillips .................................................... 48 ASR Underwriting ..................................... 49 Affinity Insurance Brokers ..................... 50 Newline Group ........................................... 50

AIBI ................................................................... 51 Pollard Insurance Group ......................... 51 Tudor Insurance ............................................ 51 Moran Insurance Brokers........................ 52

MGA Insurance Brokers .........................

Wellington Underwriting .......................

Marsh & McLennan Agency .................

All Parks Insurance....................................

52 53 54 54

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

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COMMUNITY HUB

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IN

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COMMUNITY HUB

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54 / INSURANCE ADVISER AUGUST 2021

NIBA / Forthcoming Events

STAY UPDATED!

NIBA EVENTS

NIBA stages a variety of educational and social events across Australia for the whole intermediated insurance community.

EVENTS UPDATE Mark your calendar to meet, share, learn and grow with your industry peers at NIBA events across the country.

Check out what’s happening close to yo u and registe r via the events cale ndar at niba.com.a u/ events

Please note in light of COVID-19, NIBA will continue to follow and implement national and state health authorities’ recommendations.

LOOK OUT FOR YOUR STATE’S RESCHEDULED GALA LUNCH 2021 NIBA BROKING IN 2025 WEBINAR

2021 NIBA AILA BROKER NEGLIGENCE IN COURT

WHERE: GoToWebinar WHEN: Monday 2 August 2pm–3pm Join NIBA President Dianne Phelan, Vice-president Ward Dedman and CEO Dallas Booth as they discuss NIBA’s latest project to ensure the intermediated insurance market remains strong and viable into the future.

WHERE: Mayfair Hotel Adelaide WHEN: Thursday 9 September Join the NIBA SA Committee, members of AILA and NIBA for an invigorating mock trial featuring the Hon. Justice Livesey as the judge.

2021 NIBA WA GALA LUNCH WHERE: Grand Ballroom, Crown Perth WHEN: Friday 6 August Join us for the rescheduled WA Gala Lunch on 6 August at the Crown in Perth, to celebrate after a busy end of financial year.

2021 NIBA NSW GALA LUNCH WHERE: Doltone House Jones Bay Wharf, Sydney WHEN: Friday 20 August The rescheduled NSW Gala Lunch will be taking place on 20 August and is held in conjunction with Wheelchair Sports NSW.

2021 NIBA QLD GALA LUNCH WHERE: Royal International Convention Centre, Brisbane WHEN: Wednesday 22 September Celebrate your state’s best brokers at the rescheduled Qld Gala Lunch on 22 September at the Royal International Convention Centre.

SAVE THE DATE FOR...

PROTECSURE NIBA PRESENTATION SKILLS PROGRAM WHERE: Sydney CBD WHEN: 9, 16, 23 and 30 November The Protecsure NIBA Presentation Skills Program will return in 2021. This program is inclusive of four workshops aimed to

empower your speaking skills for boardroom pitches, meetings and client consultations.

2021 NIBA SA CHRISTMAS COCKTAILS WHERE: Peter Rabbit Adelaide WHEN: Friday 12 November The NIBA SA Christmas Cocktails could not proceed in 2020, but is sure to return in 2021 with a bang to celebrate the end of year.

2021 NIBA QLD CHRISTMAS BOWLS & BBQ WHERE: The Boo, Newstead WHEN: Thursday 25 November Celebrate the end of the year with the intermediated insurance industry with a friendly tournament of lawn bowls and a BBQ inclusive of drinks – an event not to be missed.

2021 NIBA NSW CHRISTMAS COCKTAILS WHERE: Sydney CBD WHEN: Friday 26 November The NIBA NSW Young Professionals Committee is planning an intimate cocktails function to celebrate the end of the year.

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NIBA Mentoring ....................................39 Ebix.............................................................45 QPIB .......................................................... 47 NIBA Advertising ...............................IBC ASTA .................................................... OBC

If you’d like to advertise your products and services through NIBA, please contact Tony May today on (02) 9459 4303.

NIBA.COM.AU / 55

INSURER STRENGTH RATINGS

S&P GLOBAL

AUSTRALIA

INSURER FINANCIAL STRENGTH RATINGS

The following is a list of S&P Global Ratings insurer financial strength ratings assigned to insurance companies in Australia and New Zealand. Ratings at 1 June 2021.

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

RATING

NON-LIFE INSURERS AAI Ltd.

A+/POSITIVE

AIG Australia Limited

A/CreditWatch Negative

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

Hallmark General Insurance Co. Ltd. (NZ Branch) BBB+/STABLE

Zurich Australian Insurance Ltd.

AA-/STABLE

IAG New Zealand Ltd.

AA-/STABLE

LENDERS MORTGAGE INSURERS

Society of Lloyd's

A+/STABLE

Genworth Financial Mortgage Insurance Pty Ltd.

A/NEGATIVE

Medical Insurance Society Ltd.

A-/POSITIVE

QBE Lenders' Mortgage Insurance Ltd.

A/STABLE

Southern Cross Benefits Ltd.

A/STABLE

Southern Cross Pet Insurance Ltd.

A/STABLE

Westpac Lenders Mortgage Insurance Ltd.

A/CreditWatch Negative

Teleco Insurance (NZ) Ltd.

BBB+/STABLE

LIFE INSURERS

Vero Insurance New Zealand Ltd.

A+/POSITIVE

AIA Australia Ltd.

A+/STABLE

Vero Liability Insurance Ltd.

A+/POSITIVE

AMP Life Ltd.

A-/NEGATIVE

Challenger Life Company Ltd.

A/STABLE

Hallmark Life Insurance Co. Ltd.

BBB+/STABLE

MetLife Insurance Ltd.

A+/STABLE

Westpac Life Insurance Services Ltd.

A+/STABLE

NEW ZEALAND

RATING

NON-LIFE INSURERS AA Insurance Ltd.

A+/POSITIVE

AIG Insurance New Zealand Ltd.

A/CreditWatch Negative

Chubb Insurance New Zealand Ltd.

AA-/STABLE

QBE Insurance (Australia) Ltd. (New Zealand Branch) 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)

REINSURERS A/NEGATIVE

General Reinsurance Australia Ltd.

AA+/STABLE

LIFE INSURERS

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

Resolution Life New Zealand Ltd.

A-/NEGATIVE

Swiss Re Life & Health Australia Ltd.

AA-/NEGATIVE

*For the S&P Global Insurer Financial Strength Ratings Definitions visit: https://www.niba.com.au/resource/standardandpoors.pdf Copyright © 2021 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

56 / INSURANCE ADVISER AUGUST 2021

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

NEW ZEALAND

BEST’S

FINANCIAL STRENGTH RATINGS

RATING

COMPOSITE Quest Insurance Group Limited

B/STABLE

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

A/ STABLE

BNZ Life Insurance Limited

A u/NEGATIVE

CIGNA Life Insurance New Zealand Limited

A/STABLE

Co-operative Life Limited

B++/STABLE

DPL Insurance Limited

B++/STABLE

Fidelity Life Assurance Company Limited

A- u/DEVELOPING

Foundation Life (NZ) Limited

A-/STABLE

General Reinsurance Life Australia Limited (New Zealand Branch)

A++/STABLE

LIFE, ANNUITY AND ACCIDENT

Kiwi Insurance Limited

A-/STABLE

General Reinsurance Life Australia Ltd.

Momentum Life Limited

B++/STABLE

Partners Life Limited

A- u/DEVELOPING

Pinnacle Life Limited

B/STABLE

The following is a list of AM Best Financial Strength Ratings (FSRs) assigned to insurance companies in Australia and New Zealand. Ratings as at 15 July 2021.

Contact: Mr. Scott Ryrie Managing Director & Co-CEO A. M. Best Asia-Pacific (Singapore) Pte Ltd. Tel: +65 9636 3678 Email: scott.ryrie@ambest.com

AUSTRALIA

RATING A++/STABLE

PROPERTY/CASUALTY Ansvar Insurance Limited

A-/NEGATIVE

First American Title Insurance Company of Australia Pty Limited

A/STABLE

General Reinsurance Australia Ltd

A++/STABLE

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

A+/STABLE

Guild Insurance Limited

A-/NEGATIVE

Beneficial Insurance Limited

B++/STABLE

Pacific International Insurance Pty Limited

B++/NEGATIVE

Brightsideco Insurance Limited

B/STABLE

The Hollard Insurance Company Pty Ltd

A-/STABLE

Consumer Insurance Services Limited

B+/STABLE

The New India Assurance Company Limited (Australia Branch)

B++/STABLE

First American Title Insurance Company of Australia Pty Limited (New Zealand Branch)

A/STABLE

FMG Insurance Limited

A/STABLE

General Reinsurance Australia Ltd (New Zealand Branch)

A++/STABLE

Health Services Welfare Society Limited

B+/NEGATIVE

Mitsui Sumitomo Insurance Company Limited (New Zealand Branch)

A+/STABLE

New Zealand Medical Professionals Limited

B+/STABLE

Pacific International Insurance Pty Ltd (New Zealand Branch)

B++/NEGATIVE

Police Health Plan Limited

A-/STABLE

Provident Insurance Corporation Limited

B /STABLE

The Hollard Insurance Company Pty Ltd (New Zealand Branch)

A-/STABLE

The New India Assurance Company Limited (New Zealand Branch)

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

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

NIBA.COM.AU / 57

INSURANCE JOURNEY / Ian Goninon

FROM THE MAILROOM TO MANAGEMENT

The 2021 Vic/Tas Broker of the Year, Ian Goninon of Capital Innovation, is an entrepreneur who places professionalism at the centre of his risk advising services.

“I

originally got an office job as my mum wanted me to have one even though I wanted to be a bricklayer.

I started work at Commercial Union in the mailroom but when I saw the beginning of insurance broking starting up in Tasmania I thought that was better suited to me. I started my risk management career at QBE, in a program where they encouraged their managers to go out with a direct book of business and they paid for the cost of office equipment, sign writing and other items.

From early on I really wanted my own business, dealing with clients and assisting them with better insurance packages and claims. It’s something I’ve always enjoyed – it was a natural step forward from the underwriting to the broking industry.

I love the insurance industry and although I left during my career to start another business, I quickly came back to insurance.

I think the insurance industry is very interesting as it covers various occupations and activities and can involve everything from law to accounting and everything in between.

Meeting entrepreneurial people from different industries with ambitions and goals for their own businesses is great, especially here in Tasmania. Being such a small state and dealing with a variety of people, at times you also get involved in those serious or large claims where you have designed policies or modified policies and are pleased that they are able to respond. It’s always interesting to see how the outcome of some claims occur.

Over the years I’ve learnt a lot of lessons, but one big one is to not overpromise to clients and to not say a policy covers everything. You need to look at a client’s insurance requirements and design an

PROUDLY SUPPORTING

58 / INSURANCE ADVISER AUGUST 2021

insurance product that’s tailor-made to them. Get the policy right and then when you get the early-morning phone call saying there has been a robbery/ fire/flood, you know the client is covered – peace of mind for all concerned.

It has been a great journey for me, starting off as a kid in the mailroom to running my own insurance broking firm. I think by starting off on the bottom and working my way up, I got an all-round experience.

I believe the insurance industry can set you up for whatever career you end up in. It can give you a wide knowledge of business such as accounting or IT. I have had staff work with me who have left to go and work in London as an insurance broker, another to go and teach in Japan, and others that

have left Tasmania and are working on the mainland in the insurance industry.

I was not traditionally mentored when I began my career, but I did get the opportunity to go to Melbourne, Sydney and Brisbane to see how other insurance brokers managed their businesses, which was an amazing experience. I’ve mentored many of our staff throughout the years and believe it is important for staff to feel supported and given opportunities, as it will encourage them to stay in the industry.

I think it all comes down to professionalism – it is everything to us.

And the pinnacle of professionalism in insurance broking is the QPIB designation.

I would like to see the QPIB designation grow and become the equivalent to CPA.”

FIVE QUICK QUESTIONS Tell us something most people don’t know about you? I have met both the Queen and Prince Phillip and shaken hands with them.

Secret ambition? I do not have one except to lose 15kg.

Favourite tipple? Red wine. I prefer quality over quantity these days. I like a Shiraz or a Cabernet Sauvignon.

Favourite pastime? My favourite pastime is fishing, occasionally at the top end of Australia, or working in the outdoors. I live on acreage so there is always plenty to do.

Favourite food? Some eat to live; I live to eat. I enjoy eating out. I relish Spanish cuisine and love a good steak or Tassie oysters.

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

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