The insurance industry has generally welcomed the outcomes of last week’s ministerial meeting in Adelaide reached new understandings on the professional indemnity crisis.

Saying new reforms will “ease the crisis” currently plaguing the country, federal and state politicians agreed to implement nationally consistent professional standards legislation under which professional groups will have their liability capped if they adopt certain standards.

They also agreed to introduce proportionate liability so that professionals who are being sued are only liable for the proportion of the damage that they have caused. While there is still some work to be done before it all finds its way into law – Queensland is holding back from joining in, for example – the generally positive response to the move proves one thing: governments have worked out that the problem isn’t the insurers but the litigious environment.

At last week’s meeting the Federal Government agreed to introduce amendments to the Trade Practices Act which will prevent plaintiffs using Commonwealth law to circumvent state laws. But everyone wants to see fast results to the national tort reform program in the form of lower premiums. While the Insurance Council of Australia is keen to hose down hopes of plunging premium levels, Executive Director Alan Mason says insurers “expect conditions to continue to improve as the reform program concludes”.

“We indicated to the meeting that insurers are much more positive about the public liability market in 2003 than 2002 and that cover is now available for some risk categories where in the past it had been hard to obtain,” he said.

“There has been a significant reduction in the level of complaints about lack of availability of public liability and community groups are now experiencing improved access to cover,” Mr Mason said.