The Federal Government’s Terrorism Insurance Bill was passed by the Senate yesterday, and will be implemented at the start of July. Well-known insurance professional Neil Weeks will head up the organisation administering the $300 million terrorism insurance pool.

Delays to the legislation were caused by the Democrats in the Senate, who don’t trust insurers.

The party was holding things up through their concerns that small businesses’ commercial property insurance could be increased under the guise of terror cover. They wanted the Australian Competition and Consumer Commission (ACCC) to be given a role monitoring premiums.

Now Democrats leader Senator Aden Ridgeway says he dropped the demands because the Government and the insurance industry have convinced him that small businesses won’t be unfairly targeted. He said ACCC enquiries into the insurance industry haven’t found any evidence of price exploitation.

Federal Treasurer Peter Costello announced that the Australian Reinsurance Pool Corporation (ARPC) will be headed up by Northern Territorian Neil Weeks. He will be officially appointed CEO when the ARPC comes into play in July, and in the meantime is assisting Treasury to set the pool up.

Mr Weeks spent 10 years as CEO of the Territory Insurance Office, and has also held senior roles with Eagle Star Insurance Group and Guild Insurance.

The terrorism insurance scheme provides for a pool of funds funded by reinsurance premiums. It will be supplemented by a back-up bank line of credit of $1 billion underwritten by the Commonwealth, as well as a Government indemnity of $9 billion, giving aggregate cover of up to $10.3 billion when the pool is fully funded.

Insurance Council of Australia (ICA) Executive Manager Corporate Affairs Rod Frail told Sunrise Exchange News ICA has been keen to see the legislation passed “as is”, and was opposed to Labor and Democrat moves to amend it.