Post on 19-Jul-2020
ACT GOVERNMENT
CTP Regulator Presentation
Lisa Holmes representing the
ACT CTP Regulator
Objectives of the ACT CTP Legislation
• Continue improving CTP insurance
• Encourage timely resolution of claims
• Promote the rehabilitation of injured motorists
• License and supervise insurers
• Promote competition in setting premiums
• Keep costs of insurance at affordable level
• Establish a register of claims
• Promote measures to reduce motor accidents
Functions of the CTP Regulator
• Regulate the licensing of CTP insurers
• Monitor the behaviour of CTP insurers re the obligations under the Act
• Monitor the efficiency of the ACT scheme
• Identify areas for amendment
• Promote public awareness of causes of motor accidents
CTP Premiums
• Aim is to ensure that the benefits each injured person is entitled to claim are fully funded
• Insurers must seek approval of premiums
• Regulator approves or rejects CTP premiums
• Ensure premiums meet the fully funded test and are not excessive
• External actuary provides advice to the Regulator about the requested premium
CTP & Lifetime Care Premiums
Comparison of CTP & Lifetime Care premiums across Australia (passenger vehicles) at 1 July 2017
Where Does Your CTP Premium Go?
* Does not include Government levies for the Lifetime Care and Support Scheme and the Regulator’s Levy
• The top 4 components on the Bar are claims costs
• Nominal defendant costs
are also largely claims costs
2016 Review of the CTP Act
“Despite the recent decreases in premium rates, the affordability of ACT CTP policies compares unfavourably with other jurisdictions. A large part of the relatively high premium rates can be attributed to the scheme design of the ACT scheme. Unlike comparable schemes in other jurisdictions, the ACT has no threshold for eligibility for Non-Economic Loss, nor caps on benefits. This generous scheme design, relative to other Common Law schemes, limits the potential for further future premium reductions.”
Section 275 Review of the ACT CTP Act
March 2016
Number of Claims Reported
2010 2011 2012 2013 2014 2015
750
800
850
900
950
1000
Accident Year
Nu
mb
er o
f cl
aim
s re
po
rts
Claims reported for Passenger vehicles
Reported Claim Numbers
by Injury Severity Profile
Minor injuries
Moderate injuries
Serious, severe, critical or maximum
2016-17 Finalised Claims Claims Reported 2010-2015
How long is it taking to finalise claims
• Depends on the circumstances of the accident and the severity of the injuries
• smaller claims on average settle in around 1.5 years
• larger claims over $500,000 on average settle in just over 4 year, (although some claims can take considerably longer).
Average Claims Size by Injury Severity
$-
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
$400,000
$450,000
2009 2010 2011 2012 2013 2014 2015 2016
Accident Year
Minor Moderate & Serious
Claim Amounts by Heads of Damage
2016-17 Finalised Payments
Treatment & Care Costs Economic Loss
General Damages Legal & Investigative Costs
2011 accident year
Claim Amounts by Heads of Damage
by Claim Size
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
< $5k $5k - $10k $10k - $75k $75k - $100k $100k - $200k $200k to $500k
$500k to $700k
$700k to $1m >$1m
% o
f C
laim
Am
ou
nt
General Damages Economic Loss Treatment and Care Legal and investigation costs
QUESTIONS?