Skip to content Skip to main navigation

News

Fly direct from
Canberra to New Zealand

CTP going up from 16 August.

By johnboy - 7 July 2011 26

The ACT Treasury has announced that Compulsory Third Party (CTP) insurance is going up 8% from 16 August 2011.

Growth in the size of payments is to blame.

What’s Your opinion?


Please login to post your comments, or connect with
26 Responses to
CTP going up from 16 August.
Filter
Showing only Website comments
Order
Newest to Oldest
Oldest to Newst
Innovation 11:15 am 23 Jul 11

Qld_lurker said :

Classified said :

Jivrashia said :

When is some goddamn competition going to be introduced into the ACT’s CTP insurance market??

Probably when insurers don’t have to accept unlimited liability. The one insurer that is here gets paid for that risk.

The situation is more complex than most understand. It’s certainly not a case of insurers not wanting to sell CTP in the ACT.

CTP insurance is one of the riskiest to underwrite. Claims are usually large, and take years to settle, meaning the cost of those claims is exposed to normal inflation, and judiciary inflation (ie a judge decides to award more and sets a precedent for all other claims). As a result insurers need to keep massive amounts of money locked away in low risk, low yield securities for years (as governed by the likes of APRA), so you need to have pricing estimations pretty accurate or you lose a lot of money.

New players coming into the ACT have a combination of limited information to establish a prudent price, and an almost impossible task in predicting where claims costs will go. Given you need millions of dollars sitting in the bank before you even sell your first policy it’s a high risk, high cost venture.

Thanks to the earlier info on this post, it still puzzles me why there isn’t an added CTP premium for NSW drivers who are likely to drive/crash in the ACT eg Queanbeyan residents. I would have thought the reinsurers would have got a bit nervous about this aspect already……

screaming banshee 11:11 am 23 Jul 11

helium said :

Also how about enforcing the rules about having a ACT rego if you reside here. So many interstate plates in my suburb, some have been here 7+ years.

We save $600/year, thats $50/month on having on of our commercial vehicles registered to our QLD office address. If I get the chance to drive the other one up there I’ll get a roadworthy and transfer it to QLD also. If the difference weren’t so substantial it wouldn’t be worth it.

dvaey 10:01 am 23 Jul 11

OP: The ACT Treasury has announced …

That should read ‘ACT Treasury has announced that NRMA has increased their priced by 8%” to show that the price rise is due to a private firm, not the government jacking prices up again.

Qld_lurker 8:12 am 23 Jul 11

Classified said :

Jivrashia said :

When is some goddamn competition going to be introduced into the ACT’s CTP insurance market??

Probably when insurers don’t have to accept unlimited liability. The one insurer that is here gets paid for that risk.

The situation is more complex than most understand. It’s certainly not a case of insurers not wanting to sell CTP in the ACT.

CTP insurance is one of the riskiest to underwrite. Claims are usually large, and take years to settle, meaning the cost of those claims is exposed to normal inflation, and judiciary inflation (ie a judge decides to award more and sets a precedent for all other claims). As a result insurers need to keep massive amounts of money locked away in low risk, low yield securities for years (as governed by the likes of APRA), so you need to have pricing estimations pretty accurate or you lose a lot of money.

New players coming into the ACT have a combination of limited information to establish a prudent price, and an almost impossible task in predicting where claims costs will go. Given you need millions of dollars sitting in the bank before you even sell your first policy it’s a high risk, high cost venture.

dtc 9:55 pm 09 Jul 11

According to the MTAA green slip calculator website (which compares green slip costs across the 7 NSW CTP insurers), the CTP cost for a green slip in NSW for a 2005 model car garaged in Qbyn (or Ulladulla) driven by a 40 yr old driver with no accidents and max no claim bonus on comprehensive insurance, but 2 demerit points, ranges from $360 pa to $525 (however, the cheapest insurer is the one that I pretended to have comprehensive insurance with, so pogtentially a ‘bundle’ discount).

Without comprehensive insurance the cost is $393 – $525

For a 25 year old Qbyn driver the CTP premium is $526 – $529

So if the ACT premium is going to be around $520, then there isnt any difference for younger drivers and about $120 pa for older drivers.

2604 12:59 pm 09 Jul 11

helium said :

Also how about enforcing the rules about having a ACT rego if you reside here. So many interstate plates in my suburb, some have been here 7+ years.

The more the price of CTP increases, the more people will go out of their way to avoid paying ACT rego. Behold the glory of the Laffer Curve.

Related Articles

CBR Tweets

Sign up to our newsletter

Top
Copyright © 2018 Riot ACT Holdings Pty Ltd. All rights reserved.
www.the-riotact.com | www.b2bmagazine.com.au | www.thisiscanberra.com

Search across the site