The Insurance Council of Australia (ICA) has rejected the suggestion that a new levy on bank deposits should be extended to insurance policies to increase consumer protection.

A charge on designated bank deposits from 2016 will help guarantee funds during any future financial crises, according to Treasurer Chris Bowen’s economic statement last week.

It follows a review by the International Monetary Fund (IMF) and recommendations from the Council of Financial Regulators.

Reserve Bank of Australia Governor Glenn Stevens has suggested a levy could also be considered for insurers, according to the Australian Financial Review.

But ICA Communications and Media Relations GM Campbell Fuller says the IMF advice relates only to crisis management for authorised deposit-taking institutions.

“Given the differences between the business models for insurance and banking, there is not the same rationale for considering pre-funding reserves, from which claims upon a failed insurer could be paid,” he told insuranceNEWS.com.au.

A spokesman for Mr Bowen says the Government is not considering a levy on insurers.