MOTOR ACCIDENT INSURANCE ACT 1994 - SECT 15 Report and recommendations when costs of insurance exceed the affordability index

MOTOR ACCIDENT INSURANCE ACT 1994 - SECT 15

15 Report and recommendations when costs of insurance exceed the affordability index

(1) The costs of CTP insurance exceed the affordability index if the insurance premium for a CTP insurance policy for a class 1 motor vehicle (assuming the insurer’s premium is set at the highest amount set by a licensed insurer) exceeds the affordability index.

(2) If the costs of CTP insurance exceed the affordability index, the commission must give the Minister a report about the effect of current trends on the affordability of CTP insurance.

(3) Subsection (4) applies if the commission considers changes to the statutory insurance scheme or the injury insurance scheme are necessary to counter the effect of undesirable trends on the affordability of CTP insurance.

(4) The commission may, in its report, recommend the changes.

(5) If the report recommends changes to the injury insurance scheme, the commission must give a copy of the report to the Treasurer.

(6) In fixing the range within which an insurer’s premium for a class 1 motor vehicle must fall, the commission is not to be influenced by the fact that the proposed range could result in the costs of CTP insurance exceeding the affordability index if the ceiling amount is, according to actuarial advice, appropriate to ensure the financial soundness of the scheme.

(7) The Minister must, as soon as practicable after receiving a report under subsection (2) , cause a copy of the report to be laid before the Legislative Assembly.

(8) In this section—


"class 1 motor vehicle" means a motor vehicle of that class under a regulation.


"insurance premium" , for a CTP insurance policy for a class 1 motor vehicle, does not include the relevant insolvency liability component or an amount prescribed under section 13 (3B) (b) for the insurer’s premium component of the insurance premium for the policy.


"relevant insolvency liability component" means the amount included in the Nominal Defendant levy that the Minister considers is attributable to satisfying liabilities of the Nominal Defendant under section 33 (2) .