Professionals in Queensland will be at a significant disadvantage after their state government decided to refuse to apply proportionate liability to consumer transactions, says Assistant Treasurer Helen Coonan.

Speaking last Thursday at the Insurance Council of Australia's Canberra conference, Senator Coonan said the meeting of insurance ministers in Adelaide last week – the fifth such meeting – was very successful, with the ministers endorsing a national model for proportionate liability for economic loss and property damage. The meeting was also addressed by seven insurer representatives.

Senator Coonan said a system of proportionate liability will “help stem the unsustainable growth in professional indemnity insurance premiums”.

Acknowledging the Queensland Government’s determination to apply a slightly different form of proportionate liability because of concerns about the actions of some unscrupulous Queensland property investment marketers, she said the Beattie Government’s stand is not necessary. “It may significantly reduce the benefits of proportionate liability,” she said. “Certainly, it will leave professionals in Queensland at a distinct disadvantage when purchasing insurance compared to their counterparts in other states.”

Given the procedural protections envisaged under the proportionate liability model and risk management benefits of professional standards legislation, it is highly unlikely that consumers, including purchasers of real estate, will be materially disadvantaged by these reforms.

“Fundamentally, the reforms are intended to ensure that professional indemnity insurance can be purchased at reasonable prices and that consumers can have greater confidence that the professionals with whom they deal are in fact covered by insurance,” Senator Coonan said.

The Adelaide meeting also drew strong support for the implementation of national professional standards legislation. “This is expected to result in significant benefits, not only for professionals, but also for consumers, by requiring professionals to comply with rigorous standards of risk management and to take out compulsory levels of insurance,” she said.

Federal Government amendments to the Trade Practices Act and other relevant legislation to make the move possible are expected to be introduced into Parliament during the current sittings.