The Law Council of Australia has recently been lobbying State and territory government to make sweeping changes to public liability compensation laws. Some 15 years ago the fall of HIH and the surge in insurance premiums following 9/11 caused a perceived need for dramatic and sweeping changes in how public liability cases were handled in Australia. Insurance premiums were becoming unmanageable for smaller businesses and charitable organisations, and claims for personal liability compensation and the payouts from those claims were reaching unseen levels. The NSW government commissioned David Ipp QC to conduct a review of civil compensation law and based on the findings of the review sweeping changes were made to legislation in every Australian state and territory.
However in 2007 David Ipp criticised the sweeping changes made in tort law and that the new legislation had gone too far. The Australian Law Council’s Geoff Provis said that the fact that insurance companies are making very healthy profits suggested that the system was not balanced. If we look at the profits Australian insurers have been making we can see why he may remark in this way. In the last five years public liability insurance profits have averaged at $350 million per year, and in the financial year closing 2016, insurance companies made $529 million in profit.
Public Liability Insurance Explained by Small Business Insurance Brokers Australia
Why have insurance companies posted such large profits? Because of the changes to how civil compensation cases are treated since the Ipp review in 2002, there has been a 60% reduction in compensation claims lodge in court. Yet insurance premiums have not reduced at the same rate – or even close to it.
Many average Australians are feeling the pain at being barred from pursuing justifiable compensation cases. The elderly and those on low incomes are most affected by the change in legislation, with many Australians unable to afford the legal fees to pursue justice. Barrister Andrew Stone had this to say on the matter:
“There has to be a balance between individual responsibility and corporations and landowners making sure their products and premises are safe,” Mr Stone said. “At the moment we are putting all the responsibility on individuals and we are not holding the corporations responsible.”
The Law Council of Australia says that the balance has swung too far in the favour of insurance companies. A statement issued by the Insurance Council of Australia replied that:
“The reforms have struck an appropriate balance between affordable and available liability insurance for businesses and community organisations, and financial support for those who most need it.”
Australians who are not getting the financial support.
Unfortunately we are seeing many Australians who are not getting the financial support they need to recover from slip and fall style injuries. Rana Hindy is one such Australian. 47 year old Rana Hindy slipped on a broken egg whilst shopping at Westfield Sydney shopping centre. The fall she suffered caused severe damage to her neck, herniating two disks, which required surgery and having two screws implanted.
Her ongoing rehabilitation, surgery and other ongoing costs have mounted to over $90,000 out of pocket and are still accumulating. Rana said:
“I was depressed constantly. I lost my job. Basically my whole livelihood has been taken away from me through no fault of my own,”
Her medical advice included a recommendation that she seek legal redress for the injury.
“I went to three law firms to get some legal advice and they basically all told me that the legislation had changed and I pretty much had no case,” She said.
Westfield has offered Ms Hindy $3,000, which they say is an expression of goodwill. Ms Hindy contends that the cost of the injury has cost her far more.
Compensation laws are in place to protect Australians from the ongoing effects of injures that they do not deserve, however the current system seems skewed to ensure that insurance companies do not need to pay out on claims that to any fair minded person are justified.
If you have a compensation claim and are seeking advice on how to pursue compensation for an injury in Sydney