Commonwealth Numbered Acts

INSURANCE LAWS AMENDMENT ACT (No. 2) 1994 No. 49 of 1994 - SCHEDULE

AMENDMENTS OF ACTS
General Insurance Supervisory Levy Act 1989
1. Section 6 (definition of "statutory upper limit"): Omit paragraph (b),
substitute:

"(b) in relation to the financial year commencing on 1 July 1992 or 1 July
1993 - the amount calculated by multiplying the statutory upper limit for the
previous financial year by the indexation factor for the financial year
starting on that day; or

   (c)  in relation to the financial year commencing on 1 July 1994 - $17,000;
        or

   (d)  in relation to a later financial year - the amount calculated by
        multiplying the statutory upper limit for the previous financial year
        by the indexation factor for the later financial year.".
Insurance Contracts Act 1984
2. Subsection 11(1): Insert:

"'Commissioner' means the Insurance and Superannuation Commissioner appointed
under the Insurance and Superannuation  Commissioner Act 1987 , or a person
for the time being acting as Insurance and Superannuation Commissioner under
that Act;".
3. Subsection 11(1): Insert:

"'consumer credit insurance' means insurance provided by a class of contracts
of insurance:

   (a)  that is declared by the regulations to be a class of contracts to
        which Division 1 of Part V of this Act applies; and

   (b)  that is identified by those regulations as consumer credit
        insurance;".
4. After Part I: Insert:

"PART IA - ADMINISTRATION
Commissioner responsible for general administration of Act

"11A. Subject to any directions of the Treasurer, the Commissioner has the
general administration of this Act. Powers of the Commissioner

"11B. For the purpose of undertaking the general administration of this Act,
the Commissioner has power to do all things that are necessary or convenient
to be done in connection with the administration of the Act and, without
limiting the generality of that power, has power:

   (a)  to promote the development of facilities for handling inquiries in
        relation to insurance matters; and

   (b)  to monitor complaints in relation to insurance matters; and

   (c)  to liaise generally with other persons or bodies having a
        responsibility to deal with inquiries, complaints and disputes
        concerning insurance matters; and

   (d)  to review documents (including documents promoting particular kinds of
        insurance cover) issued by insurers and given to the Commissioner in
        compliance with section 11C; and

   (e)  to review particulars, statistics and documents given to the
        Commissioner in compliance with section 11D; and

   (f)  to monitor legal judgments, industry trends and the development of
        community expectations that are, or are likely to be, of relevance to
        the efficient operation of the Act; and

   (g)  to promote the education of the insurance industry, the legal
        profession and consumers as to the objectives and requirements of the
        Act. Supervisory powers - Commissioner may obtain insurance documents

"11C. (1) The Commissioner may, for any purpose connected with the general
administration of this Act, by notice in writing given to an insurer, require
the insurer to give to the Commissioner, within 30 days of receipt of the
notice, or such longer period as is specified in the notice, copies of:

   (a)  documents specified in the notice relating to insurance cover
        provided, or proposed to be provided, by the insurer; or

   (b)  documents relating to insurance cover of a kind specified in the
        notice provided, or proposed to be provided, by the insurer.

"(2) An insurer must not fail, without reasonable excuse, to comply with the
requirements of a notice under subsection (1). Penalty: 150 penalty units.

"(3) Subsection (1) does not require an insurer to give to the Commissioner
any document dealing with the insurance cover provided to a particular person
unless:

   (a)  that person, or another person having an entitlement to claim under
        that insurance cover, has given a written authorisation to the
        Commissioner permitting the Commissioner to require the giving of that
        document; and

   (b)  the Commissioner has given a copy of the authorisation to the insurer
        with the notice.

"(4) It is a reasonable excuse for an insurer to refuse or fail to comply with
the requirements of a notice under subsection (1) if to do so would tend to
incriminate the insurer. Supervisory powers - Commissioner may review
administrative arrangements etc.

"11D. (1) The Commissioner may, for any purpose connected with the general
administration of this Act, by notice in writing given to an insurer, require
the insurer to give to the Commissioner, within 30 days of receipt of the
notice or such longer period as is specified in the notice:

   (a)  written particulars of the organisational structure and administrative
        arrangements of the insurer either generally or in a particular area
        of insurance; or

   (b)  statistics relating to the nature and volume of the insurance business
        of the insurer either generally or in a particular area of insurance;
        or

   (c)  copies of any training guides, work manuals or other materials of a
        similar nature used by an insurer in instructing its employees or any
        insurance intermediaries dealing with persons who have, or may be
        likely to seek, insurance cover from the insurer.

"(2) An insurer must not, intentionally or recklessly, give the Commissioner,
in purported compliance with a requirement under subsection (1), particulars
or statistics that are false or misleading in a material particular. Penalty:
150 penalty units.

"(3) An insurer must not fail, without reasonable excuse, to comply with the
requirements of a notice under subsection (1). Penalty: 150 penalty units.

"(4) Subsection (1) does not require an insurer to give the Commissioner a
copy of any document or any information:

   (a)  that reveals the identity of a particular insured or third party
        claimant; or

   (b)  from which the identity of a particular insured or third party
        claimant can be deduced.

"(5) It is a reasonable excuse for an insurer to refuse or fail to comply with
the requirements of a notice under subsection (1) if to do so would tend to
incriminate the insurer.

"(6) In this section:
'third party claimant' means a person, other than the insured, who is, or
might be, entitled to make a claim under a contract of insurance. Examination
of documents by Commissioner not to imply compliance with Act

"11E. The fact that documents in use by an insurer previously have been given
to the Commissioner under section 11C or 11D does not imply:

   (a)  that the Commissioner has found that the documents comply with the
        requirements of this Act; or

   (b)  that the Commissioner endorses any practice or procedure described in
        the documents. Secrecy

"11F. (1) The object of this section is to create duties of non - disclosure
for the purposes of section 70 of the Crimes Act 1914.

"(2) Subject to subsections (3), (4) and (6), a person who is or has been:

   (a)  the Commissioner; or

   (b)  a member of the staff assisting the Commissioner; must not, either
        directly or indirectly, communicate to any person any information
        concerning the affairs of any other person if the information has been
        acquired by him or her:

   (c)  in the exercise or the purported exercise of powers under or for the
        purposes of this Act; or

   (d)  in the performance or the purported performance of the duties under or
        for the purposes of this Act.

"(3) Subsection (2) does not apply to a person who communicates the
information in the performance of a duty in connection with this Act.

"(4) Subsection (2) does not prevent the communication of information or the
production of a document by the Commissioner, or by a member of the staff
assisting the Commissioner authorised by the Commissioner:

   (a)  to the Minister; or

   (b)  to a court for the purposes of this Act; or

   (c)  to a person to whom, in the Minister's opinion, it is in the public
        interest that the information be communicated or the document
        produced.

"(5) A person who is or has been:

   (a)  the Commissioner; or

   (b)  a member of the staff assisting the Commissioner; is not required:

   (c)  to communicate to a court any information; or

   (d)  to produce in a court any document; acquired by him or her, in the
        exercise or the purported exercise of powers, or the performance or
        the purported performance of duties, for the purposes of this Act,
        except when it is necessary to do so for the purposes of this Act.

"(6) Subsection (2) does not prevent the communication of information or the
production of a document by the Commissioner, or by a member of the staff
assisting the Commissioner authorised by the Commissioner:

   (a)  to the Secretary to a Department of the Commonwealth; or

   (b)  to an officer of a Department of the Commonwealth, approved, in
        writing, by the Secretary to that Department; for the purpose of
        advising the Minister administering that Department in connection with
        a submission:

   (c)  made, or to be made, by the Minister administering that Department to
        the Minister administering this Act; and

   (d)  relating to the administration of this Act.

"(7) If information is communicated under subsection (6) to the Secretary to a
Department of the Commonwealth or to an officer of a Department of the
Commonwealth, the Secretary or the officer must not, either directly or
indirectly, except for the purpose mentioned in subsection (6), divulge or
communicate that information to any person.

"(8) For the purposes of this section, if a person appointed under an Act (the
'first Act') has all the powers of, or exercisable by, a Secretary of a
Department of the Australian Public Service under the Public Service Act 1922,
so far as those powers relate to a particular branch of the Australian Public
Service:

   (a)  the person is taken to be a Secretary to a Department of the
        Commonwealth; and

   (b)  an officer in that branch is taken to be an officer of that
        Department; and

   (c)  the Minister administering the first Act is taken to be the Minister
        administering that Department. Delegation

"11G. The Commissioner may by writing signed by the Commissioner delegate to a
person:

   (a)  who is a member of the staff appointed to assist the Commissioner in
        the performance of the Commissioner's functions; and

   (b)  who holds or performs the duties of a Senior Executive Service office;
        any of the Commissioner's powers under this Act or the regulations.
        Annual report

"11H. The Commissioner must, within 3 months after the end of each financial
year, give to the Treasurer a report on the working of this Act during that
year for presentation to the Parliament.". 5. Section 15: Repeal the section,
substitute: Certain other laws not to apply

"15. (1) A contract of insurance is not capable of being made the subject of
relief under:

   (a)  any other Act; or

   (b)  a State Act; or

   (c)  an Act or Ordinance of a Territory.

"(2) Relief to which subsection (1) applies means relief in the form of:

   (a)  the judicial review of a contract on the ground that it is harsh,
        oppressive, unconscionable, unjust, unfair or inequitable; or

   (b)  relief for insureds from the consequences in law of making a
        misrepresentation; but does not include relief in the form of
        compensatory damages.". 6. Subsection 40(2): Omit "$5,000", substitute
        "300 penalty units". 7. After section 55: Insert in Division 3:
        Representative actions by the Commissioner

"55A. (1) If:

   (a)  an insured has entered into a contract of insurance with an insurer;
        and

   (b)  the Commissioner is satisfied that the insured has suffered damage, or
        is likely to suffer damage, because the terms of the contract, or the
        conduct of the insurer, breaches the requirements of this Act; the
        Commissioner may, by application, if the Commissioner is of the
        opinion that it is in the public interest to do so:

   (c)  bring an action against the insurer on behalf of the insured under or
        in respect of that contract; or

   (d)  take over and continue, on behalf of the insured, an action brought
        against the insurer by the insured under or in respect of that
        contract.

"(2) If:

   (a)  a number of insureds have entered into contracts of insurance with an
        insurer; and

   (b)  the Commissioner is satisfied that those insureds have suffered
        damage, or are likely to suffer damage, because the terms of the
        contracts, or the conduct of the insurer, breaches the requirements of
        this Act; the Commissioner may, by application, if the Commissioner is
        of the opinion that it is in the public interest to do so, bring a
        single action against the insurer on behalf of all of those insureds
        under or in respect of the contracts so entered into.

"(3) The Commissioner may only bring or take over an action under subsection
(1), or bring an action under subsection (2), if the Commissioner has obtained
the written consent of the insured or of each of the insureds on whose behalf
the action is being brought or is being continued.". 8. Section 64: Add at the
end:

"(5) A reference in this section to a contract of life insurance does not
include a reference to a contract of consumer credit insurance even though
that contract extends to cover in the case of the death of the insured.". 9.
After section 64: Insert in Part VII:

"Cooling - off" period: consumer credit insurance

"64A. (1) An insured under a contract of consumer credit insurance may cancel
the contract at any time within 14 days after the insured receives a notice
referred to in subsection 71A(5) in respect of the contract.

"(2) If an insured cancels a contract, the insurer must repay to the insured
an amount equal to the sum of all the amounts that have been paid to the
insurer under the contract.

"(3) A notice referred to in subsection 71A(5) in relation to a contract of
consumer credit insurance that is sent to the insured by post is to be taken,
for the purposes of subsection (1), to have been received by the insured at
the time at which it would have been delivered in the ordinary course of post
unless the insured proves that, through no fault on the part of the insured,
it was not so received.". 10. Subsection 65(5): Omit "$5,000", substitute "300
penalty units". 11. After section 71: Insert: Notices to be provided by
insurer concerning certain kinds of insurance

"71A. (1) Subsection (2), (3), (4), (5) or (6) applies:

   (a)  to a contract of consumer credit insurance; and

   (b)  to a contract of insurance of any other kind if a contract of
        insurance of that kind is designated in the regulations as a contract
        of insurance of a kind to which the subsection applies.

"(2) Subject to subsection (6), an insurer who may, at a future time, enter
into a contract of insurance of a kind to which this subsection applies with a
person must ensure, in a manner specified in the regulations, that there is
freely available to the person a written notice that:

   (a)  is set out in a form prescribed by the regulations; and

   (b)  explains the general nature of insurance of that kind in terms
        prescribed by the regulations. Penalty: 300 penalty units.

"(3) An insurer must, immediately before a contract of insurance of a kind to
which this subsection applies is entered into, give to the proposed insured a
written notice that:

   (a)  is set out in a form prescribed in the regulations; and

   (b)  contains such information concerning the contract of insurance as is
        prescribed in the regulations. Penalty: 300 penalty units.

"(4) Without limiting the generality of subsection (3), an insurer who enters
into a contract of insurance of a kind to which subsection (3) applies may
comply with the requirements of that subsection:

   (a)  by incorporating the notice in a prominent place in the contract of
        insurance; and

   (b)  by drawing the notice to the attention of the insured seeking the
        insurance cover; and

   (c)  by giving a copy of the contract of insurance to the insured at the
        time the contract is entered into.

"(5) An insurer must, after a contract of insurance of a kind to which this
subsection applies has been entered into, send the insured by post a further
written notice that:

   (a)  is set out in a form prescribed by the regulations; and

   (b)  confirms the sale of the insurance in a manner prescribed by the
        regulations; and

   (c)  contains such further information concerning the contract of insurance
        as is prescribed; and

   (d)  if the Act permits the insured to cancel the contract of insurance -
        inform the insured to that effect. Penalty: 300 penalty units.

"(6) If a contract of insurance of a kind to which subsections (2) and (3)
apply is entered into:

   (a)  without any prior dealing between the insurer and the insured; and

   (b)  at a place other than the premises of the insurer or of an agent of
        the insurer; then, if the insurer gives to the insured the notice
        required under subsection (2) at the same time as the insurer gives
        the notice required under subsection (3), the insurer is to be taken
        to have complied with the requirements of both of those subsections.".
        12. Subsection 73(1): Omit the penalty, substitute:

"Penalty: 60 penalty units.". 13. After subsection 73(2): Add:

"(3) If:

   (a)  a supplier of goods or services is also the agent of an insurer; and

   (b)  the contract of insurance proposed to be entered into in respect of
        the provision of those goods or services is a contract with that
        insurer of a kind to which section 71A applies; and

   (c)  the information required to be given in a notice under subsection
        71A(3) includes all of the information required to be given under this
        section; the supplier is to be taken, by complying as agent of the
        insurer with section 71A, also to have complied with this section. 14.
        Subsection 74(1): Omit "$5,000", insert "300 penalty units". 15.
        Subsection 75(1): Omit "$5,000", insert "300 penalty units". 16.
        Subsection 75(5): Omit "$5,000", insert "300 penalty units". 17. After
        section 76: Insert: Liability of directors and employees etc.

"76A. (1) A director of a company, or an employee or agent (whether of a
corporation or of an individual), who intentionally or recklessly permits or
authorises a contravention of this Act by the company, corporation or
individual, as the case may be, is guilty of an offence against this Act and,
subject to subsection (2), is punishable by the penalty provided in respect of
that contravention.

"(2) If a director of a company, or an individual who is an employee or agent
of a corporation, intentionally or recklessly permits or authorises a
contravention by the company or corporation, the reference in subsection (1)
to the penalty provided in respect of the contravention is a reference to:

   (a)  the penalty that would apply to an individual in respect of the
        contravention; or

   (b)  if there is no penalty provided for an individual - a penalty not
        exceeding one - fifth of the penalty applying to the company or
        corporation in respect of the contravention.

"(3) If:

   (a)  a company or corporation is the agent of an individual; and

   (b)  a director of the company, or an employee or agent of the corporation,
        intentionally or recklessly permits or authorises a contravention of
        this Act by the company or corporation in its capacity as agent of the
        individual; then, despite subsection (1), the offence committed by the
        company or corporation as agent is punishable by a penalty not
        exceeding 5 times the penalty applying to the individual.".
        Life Insurance Supervisory Levy Act 1989 18. Section 6 (definition of
        "statutory upper limit"): Omit paragraph (b), substitute the
        following:

"(b) in relation to the financial year commencing on 1 July 1992 or 1 July
1993 - the amount calculated by multiplying the statutory upper limit for the
previous financial year by the indexation factor for the financial year
starting on that day; or

   (c)  in relation to the financial year commencing on 1 July 1994 - $70,000;
        or

   (d)  in relation to a later financial year - the amount calculated by
        multiplying the statutory upper limit for the previous financial year
        by the indexation factor for the later financial year.".
        Trade Practices Act 1974 19. Subsection 87(1E): Omit the subsection.

NOTE ABOUT SECTION HEADING 1. On the day on which section 64 of the
Insurance Contracts  Act 1984 is amended by this Act, the heading to that
section is altered by omitting "'Free - look'" and substituting "'Cooling -
off period'".