RACQ accuses Qld Treasury of giving misleading advice about CTP, bureaucrats deny charge

INSURER RACQ accused Qld Treasury of giving misleading advice during review of State’s $1.4b compulsory insurance scheme.

RACQ accused Queensland Treasury of giving misleading advice during a review of the State’s $1.4 billion compulsory car insurance scheme.

INSURER RACQ accused Queensland Treasury of giving misleading advice during a review of the State’s $1.4 billion compulsory car insurance scheme.

The blow-up was contained in an email obtained by The Courier-Mail, about establishing a new injury payments system for the compulsory third-party insurance scheme.

Treasury denies any misleading advice was provided.

But the harsh words contrast with the public statements of harmony between bureaucrats and insurers, who have hundreds of millions of dollars riding on the scheme.

CTP comes with registration and covered some injuries in motor-vehicle accidents. The Government last year examined adding a new national insurance injury scheme, covering more people.

One email, obtained via Right to Information laws, from customer-owned insurer RACQ reveals a complaint was made to Treasurer Curtis Pitt’s office.

Treasury had allegedly provided advice to a State Parliamentary Committee that savings of up to $36 could be found after “completed negotiations” with CTP insurers.

“RACQ has not completed any savings discussion or negotiations with government and we understand to date neither has any other CTP insurer,” RACQ said in the email. “The advice, views and specialist industry knowledge of CTP insurers have been ignored despite the fact that they are the companies which currently underpin the entire CTP scheme.”

But the Motor Accident and Insurance Commission, which falls under Treasurer Curtis Pitt’s portfolio, told The Courier-Mail there “was no wrong advice”.

“MAIC met with licensed insurers on a number of occasions … holding meetings with insurers individually and collectively. One of the topics raised was a discussion regarding prospective CTP premium savings. Responses to the proposed discussion were varied and indicated insufficient support to holding industry discussions,” the commission said.

The commission said it engaged “constructively” with insurers and they had spoken positively about the CTP scheme.

RACQ told The Courier-Mail it had still not worked out where the $36 savings came from, and “clarified the misconception that we had been consulted on that amount”. Still, its relationship with MAIC and Treasury was “constructive”.

RACQ said it harboured concerns about CTP’s viability due to changes in premium structures and an increasing frequency of insurance claims.

The emails show RACQ espoused concerns about a funding gap emerging in the new injury coverage. RACQ told The Courier-Mail it was now more focused on the overall scheme’s sustainability.

The scheme is currently under review, with the regulator recently estimating insurers were creaming four-times the level of profits from CTP than had been anticipated.

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