Home / Local / Calls for national reinsurance scheme fall on deaf ears
16 December 2019
The Building Ministers’ Forum (BMF) concluded on Friday with an agreement to follow up on the professional indemnity insurance crisis but did not take up the Victorian Government’s call for a national reinsurance scheme.
Victoria had pressed for stronger action ahead of the BMF meeting in Canberra, saying a reinsurance scheme to provide coverage for new construction is one way of addressing the professional indemnity crisis facing building practitioners.
The Victorian Government’s push for a national fund to pay for cladding rectification works also failed to gain widespread support at the forum.
Since July insurers have stopped providing exemption-free covers, placing many certifiers and surveyors in limbo. They have also sharply increased the excesses and premiums to account for the risk that comes with insuring clients involved in the problem-plagued building industry.
At the next BMF meeting in February, Federal Industry Minister Karen Andrews and her state counterparts will meet with the Insurance Council of Australia (ICA) to “discuss a suite of measures” to address the professional indemnity crisis.
The BMF communique says the discussion aims to explore ways to “reduce the cost and improve the availability of professional indemnity insurance premiums for building industry practitioners”.
“Enduring solutions, that reduce the cost of insurance for building industry practitioners and ensure protection for consumers, must be underpinned by the systemic reforms that are being implemented,” the communique says.
“States and territories agreed to achieve greater national consistency with regards to licensing requirements for professional indemnity insurance.”
ICA spokesman Campbell Fuller says the industry looks forward to engaging with the ministers at the February meeting.
“ICA will reiterate the improvements required before insurers would consider providing unrestricted professional indemnity insurance products,” Mr Fuller said.