Insurers have baulked at the Queensland Government’s attempts to force reductions in the price of compulsory third party (CTP) insurance.

Of the five insurers offering CTP cover in Queensland, only Allianz has reduced fees covering cars and station wagons in response to June reforms banning commission payments to car dealers.

Despite State Government claims the move reduced the cost of CTP by $24 from the Motor Accident Insurance Commission’s (MAIC) ceiling price of $313, few insurers have passed on the saving through reduced premiums.

Under the Queensland CTP scheme, the MAIC sets the ceiling and floor price, with insurers setting their premiums quarterly.

Allianz cut its headline rate by $5 in a “show of good faith”, according to Brisbane’s Courier Mail. Other insurers said the rate was affected by factors other than commission payments and that CTP in Queensland runs on razor-thin margins.

In the past year CTP premiums in the state have risen by at least 17%, according to motoring association the RACQ.

The Queensland Government decision to ban commission payments in June angered car dealers who will lose their cut earned through arranging the cover.