Industry critics are singing a familiar tune as insurers’ latest financial results come through. The word “greed” is popular as they struggle to understand why companies are reporting record earnings while premiums remain high.

Christian Leavesley, a spokesman for Melbourne-based group People’s Rights, told Sunrise Exchange News that insurers are “keen to run” from their responsibilities to consumers.

People’s Rights is an independent organisation but has support from associations including the Victorian Council of Social Service and the Australian Plaintiff Lawyers Association. 

Mr Leavesley, whose criticisms were published by the Australian Financial Review last week, says that by claiming their windfall profits do not stem from legislation to reduce compensation rights, insurers can sidestep an obligation to reduce premiums.

He says consumers are angry public liability premiums have continued to rise, because they were promised reductions in return for reducing the rights of the injured. He dismissed the fact that premium increases were substantially lower this renewals season.

The controversial news and comment website crikey.com.au has also had a go at insurers in an article entitled “Are the insurers getting too greedy?”

The edgy website’s financial services editor “Don Boredwalk” says non-shareholding consumers want to see some of the insurers’ good fortune reflected in premium rates.

“Profit has become the mantra but the pendulum has swung too far in favour of shareholders, as QBE and IAG earnings… will show,” he says.

“There’s a suspicion among some in government and in legal circles that the industry oversold the ‘poor mouth’ and ‘we’ll be rooned’ story in the wake of HIH and September 11. Now might be the time to start cutting premiums.”

Even Australian Financial Review columnist John Durie has urged insurers to justify their record earnings to non-shareholder customers. But he does take a more balanced view. Writing in the influential Chanticleer column, he says it would be unreasonable for consumer groups to assume that public liability tort reform led to the higher profits.