Insurance expert advises caution with new relief packages
LEADING industry insurance expert Mark Brown believes the new relief packages for small businesses will create more confusion than solutions for many.
Earlier this week the ACCC granted an interim authorisation to Suncorp, Allianz, and QBE Insurance - and any others who notify their intention of joining them - the ability to implement COVID-19 relief measures.
The package includes a range of measures, including that existing eligible business customers suffering hardship as a result of the COVID-19 pandemic are able to defer their insurance premium payments for up to six months.
"There are other ways to help other than simply deferring payments to the insurers, which could be fraught with danger as the legal ramifications are unknown and untested," said Mr Brown, manager of TBI Insurance Services.
"Ask yourself this question: 'You haven't paid your premium; will the insurer still pay my claim and will I have to pay the full 12 months premium upfront just to make a claim?'
If you do need help, Mr Brown said it is best to discuss any issues with your broker.
"As it is your broker that will put your interest first and will help you determine a more appropriate solution that will best suit your own personal circumstances in these difficult times.
"We all know that in these uncertain times that we must all work together, that being all insurers, all underwriters and all brokers in a joint effort to form the best possible help package that we can for our clients."
In a media release this week, the ACCC said that under the interim scheme, eligible business customers will also be refunded unused premiums for any insurance policy they need to cancel as a result of the pandemic, and will not be charged administration or cancellation fees if they do.
All policyholders, including consumers, eligible small businesses and larger businesses, who cancel travel plans will be able to get a credit or refund for any unused travel insurance premiums, again without administration or cancellation fees.
"Many small and medium-size Australian businesses are experiencing unprecedented financial hardship due to the COVID-19 pandemic, but need to maintain essential insurance protections, in some cases in order to be able to continue to operate. There is a clear and urgent need for these measures," ACCC Chair Rod Sims said.
"We have received a number of urgent formal requests for authorisations from many sectors of the Australian economy. The ACCC stands ready to grant interim authorisations quickly when they are in the public interest."