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This is a Bill, not an Act. For current law, see the Acts databases.
INSURANCE CONTRACTS AMENDMENT BILL 2011
2010-2011
The Parliament of the
Commonwealth of Australia
HOUSE OF REPRESENTATIVES
Presented and read a first time
Insurance Contracts Amendment Bill
2011
No. , 2011
(Treasury)
A Bill for an Act to amend the Insurance Contracts
Act 1984, and for related purposes
i Insurance Contracts Amendment Bill 2011 No. , 2011
Contents
1 Short
title
...........................................................................................
1
2 Commencement
.................................................................................
1
3 Schedule(s)
........................................................................................
1
Schedule 1--Definition of flood
3
Insurance Contracts Act 1984
3
Schedule 2--Key Facts Sheets
6
Insurance Contracts Act 1984
6
Insurance Contracts Amendment Bill 2011 No. , 2011 1
A Bill for an Act to amend the Insurance Contracts
1
Act 1984, and for related purposes
2
The Parliament of Australia enacts:
3
1 Short title
4
This Act may be cited as the Insurance Contracts Amendment Act
5
2011.
6
2 Commencement
7
This Act commences on the day this Act receives the Royal
8
Assent.
9
3 Schedule(s)
10
Each Act that is specified in a Schedule to this Act is amended or
11
repealed as set out in the applicable items in the Schedule
12
2 Insurance Contracts Amendment Bill 2011 No. , 2011
concerned, and any other item in a Schedule to this Act has effect
1
according to its terms.
2
3
Definition of flood Schedule 1
Insurance Contracts Amendment Bill 2011 No. , 2011 3
Schedule 1--Definition of flood
1
2
Insurance Contracts Act 1984
3
1 After Division 1 of Part V
4
Insert:
5
Division 1A--Definition of flood
6
37A Application of this Division
7
(1) This Division applies in relation to a contract of insurance (in this
8
Division called a prescribed contract) if:
9
(a) the contract is included in a class of contracts of insurance
10
declared by the regulations to be a class of contracts in
11
relation to which this Division applies; and
12
(b) the contract was entered into after the day on which those
13
regulations were made.
14
(2) However, this Division does not apply in relation to a prescribed
15
contract at any time before the transition time for the prescribed
16
contract.
17
(3) Also, this Division does not affect the operation of a prescribed
18
contract in relation to an event that occurred before the transition
19
time for the prescribed contract.
20
(4) In this section:
21
transition time, for a prescribed contract, means the time when
22
regulations made for the purposes of paragraph (1)(a), declaring a
23
class of contracts of insurance including the contract to be a class
24
of contracts in relation to which this Division applies, commence.
25
37B Meaning of flood in prescribed contracts etc.
26
(1) The regulations must define the meaning of flood for the purposes
27
of this Division.
28
Schedule 1 Definition of flood
4 Insurance Contracts Amendment Bill 2011 No. , 2011
(2) In a prescribed contract (or a notice or other document or
1
information given by the insurer in relation to a prescribed
2
contract):
3
(a)
the
word
flood has the meaning given by the regulations; and
4
(b) other parts of speech or grammatical forms of that word have
5
corresponding meanings.
6
(3) Subsection (2) has effect in relation to a prescribed contract (or a
7
notice or other document or information given by the insurer in
8
relation to a prescribed contract) even if the meaning of the word
9
flood (or other parts of speech or grammatical forms of that word)
10
provided by the contract (or the notice or other document or
11
information) is different from the meaning of flood given by the
12
regulations.
13
37C Insurer must clearly inform insured whether prescribed
14
contract provides insurance cover in respect of flood
15
Before entering into a prescribed contract, the insurer must clearly
16
inform the insured in writing whether the contract provides
17
insurance cover in respect of loss or damage caused by, or resulting
18
from, flood as defined by the regulations.
19
37D Circumstances in which prescribed contract is taken to provide
20
insurance cover etc. in respect of flood
21
(1) This section applies in relation to a prescribed contract that
22
includes provisions (flood provisions) that provide insurance cover
23
in respect of loss or damage caused by, or resulting from, one or
24
more flood events (whether or not the contract expressly provides
25
insurance cover for flood as defined by the regulations).
26
(2) The prescribed contract is taken to provide insurance cover in
27
respect of loss or damage caused by, or resulting from, flood as
28
defined by the regulations.
29
(3) The insurer under the prescribed contract may not refuse to pay a
30
claim in respect of loss or damage caused by, or resulting from, the
31
happening of a flood event by reason only that, but for
32
subsection (2), insurance cover in respect of loss or damage caused
33
by, or resulting from, that event was not provided by the contract.
34
Definition of flood Schedule 1
Insurance Contracts Amendment Bill 2011 No. , 2011 5
(4) If the prescribed contract includes provisions (also flood
1
provisions) that provide different maximum amounts of insurance
2
cover in respect of different flood events, the prescribed contract is
3
taken to provide a maximum amount of insurance cover in respect
4
of loss or damage caused by, or resulting from, flood, as defined by
5
the regulations, equal to the highest maximum amount (the
6
maximum flood cover amount) of insurance cover provided by the
7
contract in respect of any flood event.
8
(5) The insurer under the prescribed contract may not refuse to pay an
9
amount equal to the maximum flood cover amount in relation to a
10
claim in respect of loss or damage caused by, or resulting from, the
11
happening of a flood event by reason only that, but for
12
subsection (4), the maximum amount of insurance cover provided
13
by the contract in respect of loss or damage caused by, or resulting
14
from, that event was less than the maximum flood cover amount.
15
(6) This section has effect in relation to a prescribed contract whether
16
or not the insurer clearly informed the insured of the purported
17
effect of the flood provisions in the contract.
18
(7) In this section:
19
flood event means an event that is, or would be, a flood as defined
20
by the regulations.
21
37E Division not to affect provision of insurance cover for certain
22
events
23
If:
24
(a) a prescribed contract is expressed to provide insurance cover
25
in respect of loss or damage caused by, or resulting from, a
26
particular event; and
27
(b) the effect of another provision of this Division is that the
28
contract would not provide that insurance cover;
29
then that provision is taken not to have that effect.
30
31
Schedule 2 Key Facts Sheets
6 Insurance Contracts Amendment Bill 2011 No. , 2011
Schedule 2--Key Facts Sheets
1
2
Insurance Contracts Act 1984
3
1 Subsection 11(1)
4
Insert:
5
engage in conduct means:
6
(a) do an act; or
7
(b) omit to perform an act.
8
2 Subsection 11(1)
9
Insert:
10
this Act includes the regulations.
11
3 Division 1 of Part IV (heading)
12
Repeal the heading, substitute:
13
Division 1--Insured's duty of disclosure
14
4 Division 2 of Part IV (heading)
15
Repeal the heading, substitute:
16
Division 2--Misrepresentations by insured
17
5 Division 3 of Part IV (heading)
18
Repeal the heading, substitute:
19
Division 3--Remedies for non-disclosure and
20
misrepresentations by insured
21
6 At the end of Part IV
22
Add:
23
Key Facts Sheets Schedule 2
Insurance Contracts Amendment Bill 2011 No. , 2011 7
Division 4--Key Facts Sheets
1
33A Application of this Division
2
This Division applies in relation to:
3
(a) a contract of insurance (in this Division called a prescribed
4
contract) that is included in a class of contracts of insurance
5
declared by the regulations to be a class of contracts in
6
relation to which this Division applies; and
7
(b) a proposed or possible contract of insurance (in this Division
8
called a potential prescribed contract) that would, if entered
9
into, be a prescribed contract.
10
33B What is a Key Facts Sheet?
11
For the purposes of this Division, a Key Facts Sheet for a
12
prescribed contract, or a potential prescribed contract, is a
13
document:
14
(a) that contains the information relating to the prescribed
15
contract, or the potential prescribed contract, that is required
16
by the regulations; and
17
(b) that complies with any other requirements prescribed by the
18
regulations.
19
33C Insurer's obligation to provide Key Facts Sheet
20
(1) An insurer must provide a Key Facts Sheet for a prescribed
21
contract, or a potential prescribed contract, in the circumstances,
22
and in the manner, prescribed by the regulations.
23
(2) Regulations made for the purposes of subsection (1) may prescribe
24
circumstances in which a Key Facts Sheet may or must be
25
provided by electronic means. The regulations have effect despite
26
subsection 77(1).
27
(3) The regulations may prescribe exceptions to the requirement in
28
subsection (1).
29
Note:
A defendant bears an evidential burden in relation to a matter
30
prescribed for the purposes of subsection (3) (see subsection 13.3(3)
31
of the Criminal Code).
32
Schedule 2 Key Facts Sheets
8 Insurance Contracts Amendment Bill 2011 No. , 2011
(4) The following provisions do not apply in relation to the
1
requirement in subsection (1):
2
(a)
subsection
11(11);
3
(b)
section
69.
4
Offence
5
(5) An insurer commits an offence if:
6
(a) the insurer is subject to a requirement under subsection (1);
7
and
8
(b) the insurer engages in conduct; and
9
(c) the conduct contravenes the requirement.
10
Penalty: 150 penalty units.
11
33D Provision of Key Facts Sheet does not constitute clearly
12
informing
13
For the purposes of this Act, the provision by an insurer of a Key
14
Facts Sheet to a person does not constitute clearly informing the
15
person of the matters contained in the Key Facts Sheet.
16