Insurers and brokers are speculating that the Victorian Government may extend the fire services levy (FSL) cut-off date past July 1 next year.

Industry sources have told insuranceNEWS.com.au they believe the Baillieu Government is considering pushing out the date because of confusion over the transition from the FSL on insurance premiums to a levy on all property-holders through council rates.

The Government has not yet introduced the legislation to enable the change and may not do so until mid-June.

But a spokesman for Treasurer Kim Wells says the Government has made it clear that 2012/13 is a transition year.

“The Government is working with the industry to ensure the fire services levy is administered fairly during this period,” he told insuranceNEWS.com.au. “Further details will be provided in coming weeks.”

The delays and lack of information are causing confusion for insurers and brokers, amid warnings of a hostile reception as the situation becomes clearer to policyholders.

Insurers are told an annual total amount they must provide to fund the Country Fire Authority and Metropolitan Fire Brigade, which is collected via premiums. The total amount is apportioned among companies, which decide how much to levy on premiums to collect their share of the charge.

So far Zurich and Allianz have followed QBE in announcing levies of 95% on commercial premiums for Victorian country policyholders and 54% for metropolitan policyholders, increases from 85% and 44% respectively.

Insurers have diverged on charges to residential consumers. Allianz is holding the city levy at 18% and the country charge at 36% while QBE’s rates have risen to 28% from 18% for metropolitan customers and to 46% from 36% in the country.