Some state and territory ministers might not have wanted to hear it, but the message delivered by Federal Assistant Treasurer Mal Brough to a meeting with them in Darwin last week was unequivocal: The affordability and availability of all liability insurance classes has improved, and the main reason for that is tort reform.

Mr Brough says the ministers noted significant progress made by all jurisdictions in areas including state and territory personal injury laws, amendments to the Trade Practices Act, professional standards legislation and proportionate liability.

The focus of tort law reforms in all jurisdictions has achieved “the right balance between the interests of the community as a whole and the continuing right of individuals with significant injuries to seek redress”.

That might have stirred some state ministers who seem fixated on the insurance industry’s profits, but they had in front of them the recent report by the Australian Competition and Consumer Commission (ACCC) which says public liability premiums fell by 15% in the six months to June last year. Professional indemnity premiums dropped by 17% over the same period and medical indemnity premiums have fallen by 12% in 2003/04.

The Federal Government has told the ACCC to continue monitoring public liability and professional indemnity insurance for another three years and report annually.

The ministers also noted that Australian Prudential Regulation Authority is expected to release next month the first set of reports from its national claims and policies database, with detailed analytical reports available from October.

Mr Brough made his view on insurance industry profits clear the day before he went into the Darwin meeting, releasing a “report card” saying stability within the industry “is the key to putting downward pressure on insurance premiums”.

“A failure to maintain the reforms would simply expose the community to the risk of higher premiums and less availability of insurance by recreating the factors that contributed to the 2001 insurance crisis,” he said.

Mr Brough says Australians are “seeing the benefits start to flow to consumers through lower premiums, and access to medical services that were being threatened through unavailable and unaffordable insurance cover”.