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New CTP providers for Canberra!

By johnboy 19 June 2013 40

Barr

Katy Gallagher and Andrew Barr have the long awaited news that three new players are entering the Compulsory Third Party insurance market in the ACT:

Three insurers: AAMI, GIO and Apia (the Australian Pensioners Insurance Agency) have been granted licences to offer CTP insurance to ACT motorists. The licences will become effective on 1 July 2013. There is currently only one provider of CTP in the ACT.

“Today’s announcement is great news for Canberra motorists,” Treasurer Andrew Barr said. “Competition in our CTP market will bring the obvious benefit of choice.

“Competition also offers greater opportunities for innovative insurance products, more investment and employment in the ACT, and new thinking about how people injured in a motor vehicle accident might be rehabilitated and returned to health.

“We have had a single insurer in the ACT for more than three decades, and it is great for Canberrans to finally have greater product choice.


UPDATE: The Canberra Liberals’ Brendan Smyth has expressed his pleasure and says this means he was right.


Further update: The Law Society is also very happy:

The Society welcomes the news that there will be three more CTP insurers in the ACT market.

The government is to be congratulated on the success of their 2008 reforms in making CTP insurance in the ACT profitable for insurers while maintaining a reasonable level of benefits for innocent victims of motor vehicle accidents.

A senior ACT Treasury official recently informed a legal seminar that the estimated average cost of claims following the 2008 reforms fell from a forecast $157,371 in 2012 to an actual cost of $36,689.

These raw figures indicate a much larger profit than was expected when premiums were set.

We expect that this has been a factor in attracting the new insurers to the ACT market.

The extra competition may well result in lower premiums and the funding of a no-fault catastrophic care scheme.

What’s Your opinion?


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New CTP providers for Canberra!
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MissChief 10:59 pm 30 Jun 13

Even though the changes take effect from 1 July, options for other insurers wont appear on renewals until 15 July at the earliest.

Unfortunately you can’t postpone payment if you are one of the unlucky few who’s registration falls due any time between now and then, and no refund will be offered.

Seems the only option is to renew for 3 months and hope one of the other CTP providers will save you more than the extra $30 you’ll pay for a 3 month renewal.

funbutalsoserious 5:43 pm 21 Jun 13

I received my renewal just today for the 10th Jul, no mention of any other company than the dreaded NRMA.

So be careful before paying for shorter regos (like 3 months at an extra cost) as this may take some time before it is implemented.

davo101 4:02 pm 21 Jun 13

wildturkeycanoe said :

Just did a quote online with Suncorp [GIO] and I could have saved $150 per year

Cool can I borrow your time machine? I’m assuming you have a time machine to find out if the CTP regulator will approve the premiums that Suncorp will submit after July 1?

wildturkeycanoe said :

This should have been done a long time ago but Govco has been greedy as usual.

Chop71 said :

Don’t blame the NRMA board member, blame the lazy/corrupt politicians who allowed this to go on for so long.

How is the the government’s fault? Insurers have been free to enter or leave the ACT CTP market over the last 30 years. Maybe NRMA will take the opportunity to pull the pin and pull out of the ACT market?

Chop71 10:43 am 21 Jun 13

Gungahlin Al said :

I reckon NRMA has made turkeys of us here in the ACT while they’ve had the monopoly, and long-standing local NRMA board member Alan Evans has done precisely nothing about it. Yet he pocketed in excess of $118,000 last year.
Next NRMA election he should get the boot. Unfortunately, they’ve set themselves up with 4-year terms, so I believe the next election isn’t until late 2015…

Don’t blame the NRMA board member, blame the lazy/corrupt politicians who allowed this to go on for so long. I’d say Alan was doing a wonderful job (collecting the profits).

switch 10:26 am 21 Jun 13

Wish Coles would get in on this. Their home and car insurance is considerably cheaper than any of the others. I know that’s probably because they are trying to establish themselves and then drive out the competition, but they are very good value atm.

dtc 10:12 am 21 Jun 13

Remember that the new players can initially charge less because they dont have the long tail of previous claims (some under more generous schemes). They are coming in ‘fresh’ with all the benefits of recent amendments. So its wrong to say you would have saved $150 every year for 10 years, you are saving $150 this year (perhaps) and other people such as P platers will no doubt be paying more than they would otherwise pay.

What will probably happen is:

1. initially the Suncorp insurers will charge less to get market share and because they have no existing liabilities.
2. over time their prices will increase as they have to pay out claims and because they have picked up a lot of customers who will just roll over their insurance
3. NRMA will reduce its prices a little bit to compete
4. we will end up with a price reduction of maybe $50 per year on average, but some people will pay less and some will be paying more.

Gungahlin Al 9:41 am 21 Jun 13

I reckon NRMA has made turkeys of us here in the ACT while they’ve had the monopoly, and long-standing local NRMA board member Alan Evans has done precisely nothing about it. Yet he pocketed in excess of $118,000 last year.
Next NRMA election he should get the boot. Unfortunately, they’ve set themselves up with 4-year terms, so I believe the next election isn’t until late 2015…

wildturkeycanoe 6:04 am 21 Jun 13

Just did a quote online with Suncorp [GIO] and I could have saved $150 per year every year for the last 10 years had this been in place already. According to their calculators, I have been paying the same CTP as that of a P plater. Put in my years of driving experience and wala, $150 in my pocket. This should have been done a long time ago but Govco has been greedy as usual. I don’t think we will see the same rates as NSW, but bring on change if that will make things better for us.

The Antichrist 9:22 pm 20 Jun 13

magiccar9 said :

Erg0 said :

Didn’t know that, thanks for the link. It would explain why my new rego label, received yesterday, looked like it was printed with the last of the toner…

On the topic of this – would it hurt them to at least put something on the ‘stickers’ that resembled an adhesive surface. Two years running now mine has been little more than a coloured piece of paper with no damn stick on it.

From 1 July you won’t be needing the sticker anyway.

magiccar9 12:52 pm 20 Jun 13

Erg0 said :

Didn’t know that, thanks for the link. It would explain why my new rego label, received yesterday, looked like it was printed with the last of the toner…

On the topic of this – would it hurt them to at least put something on the ‘stickers’ that resembled an adhesive surface. Two years running now mine has been little more than a coloured piece of paper with no damn stick on it.

Thevoiceofchoice 12:52 pm 20 Jun 13

$20 difference between all anyway.

Skidbladnir 12:24 pm 20 Jun 13

The Queensland CTP choice (all for exactly the same price as eachother) is more about what you’re getting in addition to basic CTP, being the personal medical costs of the hit driver.
Medical cover for the at-fault-driver, typically (with RACQ offering some minor discount on membership and roadside assist).

p1 12:11 pm 20 Jun 13

Very Busy said :

Reprobate said :

Aaargh my rego is due 1 July but I will be interstate that week so I need to do it beforehand… bugger!

Are you taking your car with you when you go interstate? If not, and it isn’t being used by anyone else, there is no point in having it registered while it isn’t being used.

Or even if you have your car with you interstate, why don’t you wait until one minute past midnight on the first of July, then pay over the internet? Since from that day on rego stickers will no longer be issued, you will immediately be legally able to drive it.

HiddenDragon 12:10 pm 20 Jun 13

Roundhead89 said :

Don’t be fooled by claims that the price of CTP will go down now that there are new players. In NSW after competitors to the NRMA were brought in, the price of green slips went down for a few months then shot up again. And don’t be fooled by the smoke and mirrors claims of three new competitors. In reality there is one new competitor. GIO, AAMI and APIA are all owned by Queensland-based Suncorp, formerly known as the State Government Insurance Office (SGIO).

I’ll be happy(ish) if they don’t go up quite as quickly as in the past – but as you point out, insurance companies are masters at the art of the catch-up and the clawback, after giving a brief breather to their customers.

Erg0 11:59 am 20 Jun 13

Reprobate said :

I did find a reminder though that from 1 July rego labels won’t be required in the ACT: http://www.rego.act.gov.au/Whatsnew/regolabelabolish.htm

Didn’t know that, thanks for the link. It would explain why my new rego label, received yesterday, looked like it was printed with the last of the toner…

Roundhead89 11:57 am 20 Jun 13

Don’t be fooled by claims that the price of CTP will go down now that there are new players. In NSW after competitors to the NRMA were brought in, the price of green slips went down for a few months then shot up again. And don’t be fooled by the smoke and mirrors claims of three new competitors. In reality there is one new competitor. GIO, AAMI and APIA are all owned by Queensland-based Suncorp, formerly known as the State Government Insurance Office (SGIO).

Reprobate 11:42 am 20 Jun 13

Watson said :

Reprobate said :

Aaargh my rego is due 1 July but I will be interstate that week so I need to do it beforehand… bugger! Mind you, not sure APIA would be able to offer insurance to a 45YO whipper-snapper anyways…

No need to do it in advance? You can do it online on the day.

Will be driving on that day so the thought of spending a pleasant lunchtime stop trying to find wifi or a stable 3G connection to get onto the regoACT website on my mobile doesn’t appeal. Especially if a “saving” from the competition doesn’t eventuate.

Anyway, won’t the basic rego charge be going up as of 1 July anyway? It’s almost impossible to find the schedule of current fees on the website, let alone those for 2013-14. I did find a reminder though that from 1 July rego labels won’t be required in the ACT: http://www.rego.act.gov.au/Whatsnew/regolabelabolish.htm

dtc 11:16 am 20 Jun 13

cranky said :

The way to reduce premiums is to remove the lawyers picnic that is the current scheme. Obscene dollars go into ambulance chasing legal pockets as cases are argued in court. Other jurisdictions have little dificulty in applying a formula to injury/compensation payouts, resulting in vastly lower premiums required to pay for the schemes..

Have you ever been injured in one of those other jurisdications and tried to figure out your rights?

And, actually, other than NZ, which jurisdictions do you say have these formulas and have vastly lower premiums? NSW is about $100 per year cheaper (really peanuts given the costs of owning a car) and provide vastly reduced cover for any injured person. Great, you save $100, the injured person suffers $1000s

Watson 10:28 am 20 Jun 13

Reprobate said :

Aaargh my rego is due 1 July but I will be interstate that week so I need to do it beforehand… bugger! Mind you, not sure APIA would be able to offer insurance to a 45YO whipper-snapper anyways…

No need to do it in advance? You can do it online on the day.

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