The NSW emergency services levy monitor should have a broad remit to research insurance industry pricing practices, as was the case under previous arrangements, a consumer group says. 

The Financial Rights Legal Centre says reforming the levy is unfinished business that needs resolving to ensure fairer outcomes for consumers and improve insurance affordability. 

“Key to this transition is the creation of a price monitor, independent of industry and empowered to investigate, conduct research and collect and collate information relating to pricing practices,” it says in a submission on the reform. 

The Labor state government is consulting on a property-based levy as it resurrects and revamps a reform dropped by the Coalition in 2017.

State parliament has passed legislation to give the Independent Pricing and Regulatory Tribunal responsibility for monitoring pricing and ensuring premium reductions from the removal of the levy on insurance are passed through to consumers. 

In 2018 the Insurance Council of Australia was critical of then levy monitor Allan Fels for investigating broader pricing issues as the role continued beyond the decision to ditch the reforms. It wants IPART to have a remit limited to confirming the pass-through of ESL reductions to consumers and says strong consideration should be given to limiting unnecessary costs for insurers. 

Financial Rights says the previous monitor produced research that was valuable for the reform process and provided important insights. 

“We raise this issue as we are concerned that the insurance sector will again seek to limit the ability for an independent pricing monitor to undertake appropriate research into pricing practices,” it says. 

The submission says any overcollection of ESL contributions must be returned to policyholders in line with the process during similar Victorian reforms, and if that is not practical they should be paid to insurance-related consumer assistance and advocacy services. 

Policyholders should also be provided with sufficient information to identify the total premium and components of base premium, ESL, GST and duty paid for the year before and after the change, and the reasons for the change, Financial Rights says.