Using insurance to cover workplace safety breach penalties will be illegal under a NSW Parliamentary bill introduced ahead of possible national reforms.

“If those who breach work health and safety duties are able to escape the consequences of their actions, their incentive to take those duties seriously is substantially lessened,” Kevin Anderson, Better Regulation and Innovation Minister, told Parliament.

In February, Safe Work Australia released a report from independent reviewer Marie Boland on recommended workplace safety reforms, but Mr Anderson says amendments to model national laws are not likely to be progressed until well into next year.

“I am of the view that NSW cannot afford to wait,” he said. “Careful consideration has been given to the amendments likely to be made at a national level as well as to the needs of NSW now.”

The Insurance Council of Australia says recommended changes regarding cover for penalties and fines are a matter for state governments, but it supports legislation that reduces workplace breaches.

“Most standard insurance policies don’t cover fines and penalties relating to workplace safety breaches,” spokesman Campbell Fuller told insuranceNEWS.com.au.

Ms Boland’s review says proposed changes to make rules explicit on insurance were widely supported during consultations and would be in line with similar laws in New Zealand.

Existing laws are unclear over cover for penalties, but feedback from regulators suggests that some claims have been paid despite uncertainty about the legal validity, the report says.

Penalties for workplace safety breaches will also rise under the NSW legislation, which won’t go to the Upper House until next year, and the Government has highlighted that workplace deaths may be prosecuted as manslaughter under the Crimes Act.