The Insurance Monitor issues revised guidelines for setting premiums

Posted: 14 July 2017 11:24 am

Houses caught up in bushfires have been razed to the ground, while others were spared

Insurance CEOs asked to publicly commit to new systems and procedures.

The Insurance Monitor has released new guidelines for property insurance companies prohibiting them from engaging in false or misleading conduct and price exploitation.

The move comes in the wake of the NSW government's tabling of the Fire and Emergency Services Levy (FESL).

While the FESL is deferred, the Emergency Services Levy (ESL) will remain in place and will be collected through home insurance premiums.

The ESL was originally meant to be scrapped on 1 July 2017.

Insurance Monitor Professor Allan Fels AO is seeking a public commitment from home insurance company CEOs that they will adopt these new systems.

“The guidelines enforce the requirement for insurers to specify how much ESL they will charge in renewal notices and also for the first time, in online quotations," Fels said.

Fels said that NSW policyholders should not have to pay more than is necessary to recover the ESL.

“Any unreasonable price increases will be subject to scrutiny from my office,” said Fels.

There will be a transition period of two years, 2017-2018 and 2018-2019, after which time insurers will have to justify their adoption of the levy.

In March 2017, the Insurance Monitor released a report finding a huge disparity in the premiums charged for home insurance in NSW.

The report found that some insurers were charging up to $1,100 more than their rivals for the same cover of the same house.

Home insurance headlines

Picture: Shutterstock

Get more from Finder

Ask an Expert

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and Privacy & Cookies Policy.
Go to site