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Special offer to CPR Insurance clients

Employsure are providing a FREE Business Health Check to all our clients and gives you the opportunity to receive an analysis of the health and safety requirements in your workplace. Also. Employsure  will review your employment agreements as well as your wage rates helping you to avoid workplace claims.

Ordinarily this would cost you at least $1,250 but because you are a CPR Insurance client, it is free!

It involves the following review for you.

SAFECHECK

A specialist Work Health and Safety Consultant will visit your workplace and carry out:

  • A review of your business’ current work health and safety policies, procedures and systems to identify areas of concern or non-compliance

  • Following the review, you will receive a report summarising the findings and the health and safety

  • Status of your workplace

WAGE CHECK

A Wages Adviser will review your rates of pay and produce a Wage Check report.

  • The review will be conducted against the industrial instrument applicable

  • A report will be supplied advising if the wages are compliant and what steps to take to achieve compliance

CONTRACT REVIEW

A Document Consultant will review an employment agreement and provide recommendations.

  • The review will highlight compliance issues with the Fair Work Act 2009 as well as best practice

  • The report will make recommendations to achieve compliance and provide protection to your business.

This will remove any areas of potential dispute and risk

So what do you have to lose? Contact us on 07 3123 1137 and arrange 

D&O premium pool ‘must treble’ to return to profitability

A new report – called "Show Me The Money!" by insurer XL Catlin and law firm Wotton + Kearney – is the second in a series of three white papers on securities class actions and their impact on the Directors & Officers Liability (D&O) market. The main conclusion is that Directors’ and officers’ (D&O) insurance premiums are under-priced significantly and need to rise strongly to restore profitability. The main risk areas are those exposed to securities class actions, 

It says Directors & Officer's Side A, Side B and Side C cover has been chronically underpriced since at least 2011, while the frequency of class actions is increasing as more plaintiff lawyers and litigation funders enter the space.

The analysis suggests last year’s overall premium pool of about $210 million would need to increase by at least three times to establish a profitable market, if it is assumed all other factors stay unchanged.

“Recent market developments would indicate most D&O insurers are now endeavouring to restore some semblance of profitability to their portfolios after years of market losses,” the report says.

75% of Cyclone Debbie claims settled

In the 6 months since Cyclone Debbie devastated Queensland and parts of northern New South Wales:

• more than 31,000 homes and business have been repaired or received settlements from their insurance company

• more than 20,000 families have had possessions replaced

• more than 4,500 motor vehicles have been repaired or new vehicles provided

• hundreds of local builders and trades have been working on properties to repair the damage and destruction caused by the cyclone

• over $5 million has been paid EACH DAY to assist local communities, residents and businesses.

Illegal or unsuitable cladding now a big issue

Why we have laws, regulations and Australian standards? Because some people just do the wrong thing all for the sake of making money. The cladding issue is the subject of 4 Corners program on the ABC.

We are already seeing Insurance policies now placing exclusion endorsements into their policies excluding and claims relating to illegal cladding. We are seeing Governments demanding Audits of all existing buildings above a certain height. There are accusations of Builders taking other short cuts such as on Wiring, Pipes and sprinkler systems. 

The question is, who is to blame? Who will take responsibility?

Small business in NSW

Right after the NSW Government have reimposed Fire Service Levies, they have at least made an effort for small business.
The government has announced it will abolish stamp duty on a number of policies taken out by a small business. This is an important change.

What is a small business?
In order to gain the exemptions, the business must be a small business for Capital Gains Tax Purposes for the income year in which the insurance is effected or renewed.
A small business for CGT purposes is:
“an individual, partnership, company or trust that is carrying on a business, and has an aggregated turnover of less than $2 million.”

I Wannacry over Petya

Just as our businesses avoided or got over WannaCry, the name given to the recent Ransom\ware, there's a new attack following close behind. It appears it is exploiting the same vulnerability as Wannacry. The malware responsible is widely thought to be a version of Petya. This latest  ransomware has already crippled Ukrainian government departments, banks, power distributors and transport networks. Now apparently it has spread to other high-profile victims such as a British advertising firm, a French construction materials giant and one of the largest pharmaceutical companies in the world. Australia is unlikely to avoid it this time, with Cadburys and TNT having announced they have fallen victim. the Australian staff of DLA Piper, a global law firm, has apparently been locked out of IT systems after Petya impacted one of its overseas offices.  

The ransomware continues to spread and it’s far from over. The Assistant Minister for cyber-security Dan Tehan is calling the fresh attack a "wake-up call" and the Prime Minister's cyber security advisor Alastair MacGibbon has warned against paying ransoms for Petya, urging businesses to instead back up their data to "avoid being a victim in the first place".

So it is now time for you to manage this risk effectively.

What cost to me after a Cyber attack?

It does very much depend on the type of attack that has been made on your systems or Web site. However, below are examples of some of the areas you will spend money. How much? How long is a piece of string?

Have you budgeted for the following Expenses in managing your Cyber Risk?

  • Payment of a ransom? (Maybe a cheaper solution to get your system back temporarily)

  • data recovery and data rebuilding (IT consultants and data recovery contractors),

  • Loss of reputation on the business (You will need Crisis Managers, Public Relation consultants, Staff communications, clients and other stakeholders, marketing and advertising),

  • Various Accountants and consultants’ fees needed to measure and prove the loss

  • Managing the recovery – particularly to mitigate breach of privacy or confidentiality of client information and informing all of them who are affected by a breach how you are dealing with it (mandatory breach reporting requirements)

  • Lost Sales due to this Business Interruption (particularly when ability to generate online sales has been affected),

  • additional costs incurred to maintain business operations or mitigate sales losses – hiring a more specialist firm to deal more quickly with being off air

Cover these expenses with a Cyber Risk Insurance policy. Ask us how?

Ransomware a threat

You sit down at your computer to check your email. It is Christmas time and you are getting notes from many different delivery companies saying that a package was unable to be delivered to your home. Please click on the reply button (link) to advise where or when the parcel can be redelivered.

It looks authentic, you have no reason to believe that it simply advice about collecting yet another parcel in time for Christmas. The company named is well known and reputable. Admittedly the email address looks a little strange. However, you also know there are many new domain names and extensions now, You click on the reply button…

Above-average cyclone season looms

Insurers should brace for an above-average cyclone season due to weakening La Nina conditions in the Pacific Ocean and warmer than average sea temperatures to the north and east, according to the Bureau of Meteorology.

The cyclone season begins next month and ends in April.

The bureau says Australia has a 67% chance of an above-average season, while the west has a 59% chance, the northwest 63%, the north 56% and the east 58%.

In neutral years the first tropical cyclone to make landfall typically occurs in late December, while in La Nina years it usually hits in the first week of December, the bureau says.

Insurance Council of Australia spokesman Campbell Fuller says even an average cyclone season – consisting of 11 events, four of which make landfall – can be devastating.

“An above-average year could bring many more than that, and each one has the potential to cause catastrophic damage if it crosses the coast in a heavily populated area,” he said.

As reported by insurancenews.com.au

Beware the escape clause in Motor policies

Cheap motor insurance can have some tough exclusions
The Policy Comparison team at LMI have highlighted some new exclusions have been introduced by some of the “Cheapy” direct insurers.
Previously Motor Insurance wordings did not have an exclusion for “reckless acts” but this has now changed. 
Reckless driving is often defined as a mental state in which the driver displays a wanton disregard for the rules of the road; the driver misjudges common driving procedures, often causing accidents and other damages. The legal dictionary defines reckless driving as operation of an automobile in a dangerous manner under the circumstances, including speeding (or going too fast forthe conditions, even though within the posted speed limit), driving after drinking (but not drunk), having too many passengers inthe car, cutting in and out of traffic, failing to yield to other vehicles, and other negligent acts.

Summer catastrophe bill over $500 million

Insured losses for the four catastrophes declared over summer have gone above $550 million, according to the Insurance Council of Australia. 

There was a bit of a “sharp rise in value” of losses with the Great Ocean road bushfires that hit Victoria over Christmas. Insured losses from the Victorian bushfires now stand at $110 million from 527 claims, compared with $88 million one month ago.

Rob Whelan, CEO of the ICA, said that the clean-up operation in the state is well underway with at least 15 sites cleaned up so far by contractors. Insurers can only commence rebuilding once each site has been cleared of debris, including asbestos. 

Also the extremely steep terrain is presenting significant challenges, but insurers are determined to rebuild homes in the shortest time possible once the design and planning approval process is completed.

 

Hot summer leads to more claims

Insurance claims have so far exceeded $515 million this summer. Unfortunately they are likely to increase further as the country continues to deal with bushfires and severe storms.
The Insurance Council of Australia (ICA) said the figure is made up from four catastrophes. These include three major bushfires in Pinery in South Australia, Victoria's Great Ocean Road and in Yarloop in Western Australia. Then there was also the Sydney storms and tornado in December. 
Insurers were expecting this to be a highly dangerous summer. The predictions were for a heightened bushfire risk in exactly the areas that have suffered bushfires. It is still only the middle of  summer. The world has also experienced the hottest year on record since 1880. With more evaporation of land and oceans, combined with more mositure in the atmosphere creating more storm activity and then a greater volume being dumped somewhere else on the planet, it is unlikely these events will reduce into the future.

Kidnap & Ransom - do not take the risk

"Hello, my name is Warren Rodwell. I have the dubious distinction of being the longest held Australian captive out of war, after being shot through the right hand when kidnapped in the southern Philippines on December 5, 2011 by the Al Qaeda-linked Abu Sayyaf Group (ASG). It was necessary to eventually have a finger amputated.

The ASG threatened to behead me if the original ransom demand for $US2 million was not paid. Both the Philippine and Australian governments had strict policies of refusing to pay ransoms. After the payment of $AUD94,000 for "board and lodging" expenses by my siblings, I was released 472 days later on March 23, 2013, and subsequently returned to Australia to rehabilitate, after losing about 30 kilograms in weight due to starvation. 

Now when I travel, I always make sure I have the right cover. A policy with adequate Kidnap and Ransom cover, along with good medical and repatriation coverage. I did not think this could ever happen to me, but it did. I certainly wish I had the right cover that would have assisted me. So speak to your Insurance Broker and make sure you get the right advice and have the right cover for any future trips you make overseas"

Parcel Delivery alert emails are a Scam

Watch out for fake parcel delivery scams arriving in your inbox this Christmas. More than $80,000 was reported stolen to the ACCC this year from over 1,360 complaints. There has already been over 100 reports of this scam already this December – more than last December, with only half the month gone. The ACCC is also seeing a significant increase in both personal and commercial information loss being reported to this scam, with over 350 reports this year compared to 250 in 2014.
Scammers take advantage of the busy Christmas season to send you emails about a ‘missed parcel delivery’, purportedly from trusted services such as Australia Post or FedEx. The emails may be personalised with your name and address and look to be from a legitimate company complete with fraudulent logos, they have warned.
The email may mention a fee will be charged while they hold your undelivered item. Scammers ask you to open an attachment or download a file to retrieve your parcel. If you follow these instructions, an executable file (.exe) will load on to your computer and install ransomware as soon as it is opened.

 

Pools in Queensland must meet safety standards from 1 December 2015.

Pool laws were passed in 2010, but a five-year grace period was established to give pool owners time to comply.

Councils have the power to issue on-the-spot fines.

If a household does not meet the key safety requirements, residents could be slapped with on-the-spot fines of up to $796.95, and further penalties up to $18,785.25 can be imposed on pool owners.

Pools also must be registered on a pool safety register, and failure to register could result in a fine of up to $2,356.

Let councils know about non-compliant pools...

This summer’s cyclone forecast

This summer we are expecting less tropical cyclones thanks to what is known as the El Niño weather cycle which is currently occurring in Australia. This effect causes the number of cyclones to reduce compared with the historical average.

The Australian region has only a 9% chance of having more tropical cyclones than average, meaning a 91% chance of having fewer tropical cyclones than average.

It is possible Queensland may not get any cyclones this summer. Historical averages show 11 cyclones occurring over the full season, with 4 tropical cyclones crossing the Australian coastline, but the El Niño cycle does not mean cyclones will disappear entirely but much less are expected.

The cyclone season is considered to be November to April. The strong El Niño in the tropical Pacific Ocean is expected to continue into 2016, and typically delays the date of the first cyclone to cross the Australian coast.

But there has never been a cyclone season without at least one tropical cyclone crossing the Australia coast.

With lower than average numbers expected, the outlook does warn those living in cyclone-affected regions to still prepare for cyclone season as the disastrous effects of under preparation are well-known.

Even small cyclones have had a devastating effect on our communities. 

So still be prepared for Cyclones but hopefully the risks will be lower while we remain in El Nino. 

For the BOM report read here

The Risk to our cities

Lloyd’s has launched a ground-breaking new study that for the first time quantifies the potential economic impact of various manmade, natural and emerging threats on the world’s leading cities.

Lloyd’s City Risk Index 2015-2025 looks at the projected GDP of 301 cities over a ten-year period and calculates how much of it is at risk from 18 specific threats. That figure totals $4.56 trillion, which represents a significant drag on future economic development.

The Index is intended to stimulate discussion – and, where appropriate, prompt innovation – between insurers, governments and businesses to help to improve resilience, mitigate risk and protect infrastructure.

To explore Lloyd’s City Risk Index 2015-2025, go to Lloyds City Index

Cockies or Cockles?

Own a Restaurant or Cafe? Check out this Caloundra venue where they were fined more than $18,000 for breaches of the local Food Safety laws. By not spending a little bit more time and money to make sure your kitchens are nice and clean, you can instead pay whopping big fines to the Council and damage the name of your brand so disgusted people will spread the word and never come to your Restaurant and Cafe again. And if you do manage to avoid the council inspection and instead poison your customers with Salmonella or other bacteria, you may have your Products Liability cover to protect you. Or will you!

Check the Conditions of cover for clauses such as "reasonable precautions" or "abiding by local statutory regulations" as requirements to have a claim accepted or you could be paying out of your own pocket..

CLAIM STRESS OUTWEIGHS DISASTER

by Cecilia Harris, NIBA Broker Buzz

New research has revealed that dealing with an insurer after a catastrophe can be more stressful for policyholders than the event that caused losses in the first place.

Kelly Dixon, from QUT’s School of Psychology and Counselling, studied the mental health impacts caused by the flood disasters in Brisbane in 2011 and Mackay in 2008, producing some interesting incentives for policyholders to utilise the help of a professional broker when dealing with insurers.

The study shows that, while the flooding event was stressful on the day, the most trying part of the experience for many people was the aftermath, including dealing with insurance companies and the re-building process.

“The findings showed that aftermath stress contributed to poor mental health outcomes over and above the flood itself, prior mental health issues and demographic factors,” Dixon says.

“Aftermath stress was the strongest predictor of post-traumatic stress symptoms with 75 per cent of people saying the most difficult aspect was the aftermath and dealing with insurance companies.”

Expert advice vital in strata cover purchase

The National Insurance Brokers Association (NIBA) has cautioned strata unit owners and body corporate committees in North Queensland that buying insurance cover direct from an insurer without seeking expert advice may end up being false economy.

NIBA was responding to an announcement by one insurer that it would offer strata insurance direct to owners and body corporates of small unit complexes at a promised saving in premium.

NIBA CEO, Dallas Booth, said strata insurance is traditionally sold through brokers for a very good reason - the importance of expert advice.

"There are three key reasons for this. Firstly every strata building is different, and will have different risks and challenges which need to be taken into account when thinking about insurance; secondly, strata insurance policies all vary, and care needs to be taken to ensure the policy matches the needs of the strata block; and thirdly and most importantly, the amount of cover (the sum insured) needs to be adequate, or the strata owners will be exposed if a major loss occurs.

"As a general rule, insurance companies do not give advice to clients on what product is appropriate -- only licensed insurance brokers do this. And it is even more important to get advice when the market is difficult, which it has been for the past three years and continues to be in many areas of Australia," Mr Booth said.

Premium earnings up but profit down

The Australian general insurance industry earned net profit after tax of $4.1 billion last year, down 12.8% on the 2013 figure.

However, net earned premium was up 3.2% to $31.7 billion, according to the latest statistics from the Australian Prudential Regulation Authority.

Of this sum, primary insurers wrote $30.1 billion and reinsurers $1.6 billion.

Gross incurred claims increased 3.6% to $29.8 billion, while net incurred claims were up 11.8% to $20.8 billion. Gross incurred claims for domestic motor grew 6.1% to $5.7 billion due to higher claims from catastrophes, including last November’s Brisbane hailstorm.

Increased claims led to reduced underwriting profit of $2.7 billion, down from $4.1 billion in 2013.

Short-tail classes such as householder and domestic motor powered the overall premium rise, while investment income for the industry grew 24% to $4.2 billion.

The net loss ratio was 66%, up from 61%, and the underwriting expense ratio was unchanged at 26%.

Total industry underwriting expenses increased 2.1% to $8.1 billion.

At December 31 there were 103 insurers and 12 reinsurers licensed to conduct general insurance business in Australia.

Thankyou to Insurancenews.com.au for this article

Top Risks for 2015

Insurance Business online reports that the following are considered the biggest risks for 2015 according to a survey.

Top Australian Risks 2015

  1. Business interruption and supply chain – 47%
  2. Loss of reputation or brand value – 35%
  3. Intensified competition – 35%
  4. Talent shortages/aging workforce – 24%
  5. Natural catastrophes – 24%
  6. Market stagnation or decline – 18%
  7. Market fluctuations – 18%
  8. Commodity price increases – 18%
  9. Changes in legislation/regulation – 12%
  10. Credit availability – 12%

Top global risks 2015

Cyber Attacks - the new global war

If you click here on this link, you will see a map showing real time Cyber Attacks occurring around the world. Where they come from and where they are going to.

Australia is one of the biggest targets of them all.

We have Insurance solutions to protect you from such financial losses that could occur to your business by someone unlikely to be local.

Just recently, Ello, the anti-facebook start up site, has been hit denying their service for 45 minutes. The Grocery stores Supervalu had a second attack on its payment systems.

Have a happy and safe new year

CPR Insurance Services has had a fantastic 2014, thanks to all our clients and supporters. We thrive on the success of our clients and our commisserations go to those businesses that did not survive what has been a tough year for many.

This year CPR Insurance handled a record amount of claims with all but one being successfully resolved or on its way to being settled. The one we have not had settled yet, we keep fighting for our client and always will when it is a legitimate claim. 

The majority of our claims this year were storm related. They involved water damage caused by entering buildings, hail damage and lightening damage. Crash Repairers appera to be booked up until May and there is no glass for the glaziers at the moment. Widespread catastrophes are difficult, but we appreciate your patience. The two storms on the 19th November and 27th November 2014 caused more than one billion dollars of damage.

More storms are expected this summer, so plan your protection strategy. See our article here or follow the attached tips below.

In the meantime, have a safe Christmas and a successful new year from everyone at CPR Insurance Services.

Yes we had a couple of cold days but…still Record temperatures!

Did you know that overall last year was Australia’s warmest on record? Are we about to pay the price for it?

The Bushfire and Natural Hazards Co-operative Research Centre (CRC) has published its outlook for the coming fire season. It shows “above normal” danger for large parts of our country.

Much of the east coast, from mid-Queensland to Victoria, is marked in red.

This is a consequence of last year’s very high and prolonged temperatures, which have continued into this year in many areas.

There also has not been as much rainfall in the east and southwest Australia over the past two years.

What this means is more moisture is sucked up from the environment causing more dryness in the forests and grasslands.

Combine the predicted El Nino conditions in the Pacific, and an early and severe fire season is the likely outcome for many parts of the country.

It does take a great deal of rain for the underlying dry conditions to change as any surface moisture will be quickly dispersed.

There has been a prolonged rainfall deficit in forested regions on the west and east coasts. This will lead to a much higher likelihood of bad fires in the forested regions.

Warning ATO is after Professional Services firms

The ATO has released a set of guidelines to assess tax compliance risks and allocation of profits, specifically targeting the professional services industry. A new set of risk assessment factors for remuneration of an ‘individual professional practitioner’ (IPP), with compliance activity around these criteria havec ome into effect from this year.

If an organisation cannot satisfy any of the guidelines, the individual professional practitioner’s arrangement will be considered higher risk. 

This all demonstrates a continued effort by the ATO to target organisations who have failed to adhere to their compliance requirements.

CPR Insurance Services cannot provide advice on this matter, but as your trusted adviser, we feel it is important to bring this to your attention to enable you to mitigate the potential loss and for your tax advisor to undertake assessment of your tax compliance.

Further protection can be provided by obtaining a Tax Audit cover that will cover the cost of additional fees required by your Accountant to assist in an audit or investigation actually made against your business. Save yourself from these risks.

AILA Conference promises lots

The Australian Insurance Law Association 2014 National Conference will be held at Hamilton Island, Whitsunday’s, Queensland from Wednesday 17th to Friday 19th September 2014.

This is a must attend event for any Insurance Law experts and Insurance technical experts. 

Mix with the cream of the best specialist Insurance Lawyers and experts in the country.

Speakers include: The Hon. Michael Kirby AC CMG, (who helped create the Insurance Contracts Act), The Hon. Justice Martin Daubney, Supreme Court of Queensland, Robert Kelly, Managing Director and CEO, Steadfast, Britt Pickering, Claims Director, The Shipowners' Mutual Protection and Indemnity Association, Matthew Hockaday, Partner, Thynne & Macartney, Chris Bertuch, Group General Counsel & Company Secretary, Insurance Australia Group, Christopher Johnstone, Barrister-at-Law, Dr Des Derrington, Barrister-at-Law, Robert Bain QC, Tony McGrath, Chairman, McGrathNico, Ron Ashton, Barrister-at-Law, and Damian Scattini, Principal, Maurice Blackburn plus many more.

Click here for more information 
http://www.aila.com.au/2014/

Robert Cooper named again as a Top 30 Elite Broker

With more than 5,000 Insurance Brokers around Australia, to be named as one of the Top 30 by Insurance Business Magazine is quite an honour. Even better if named two years running.

Not simply based on revenue, but also on retention of clients, new business growth, qualifications, contribution back to the industry, integrity, ethical standards, skill, knowledge and ability to influence change for the better in the industry. All attributes that go towards receiving such an award.

CPR Insurance Services continues to grow, thanks to our fantastic clients, many of who have supported us from the very beginning. This award is shared with those that choose to place their insurance risks in our care.

Thank you to all of you.

Climate change now part of catastrophe models according to Lloyd’s

Catastrophe Modelling & Climate Changeproduced by Lloyd’s Exposure Management & Reinsurance team, says policymakers and planners need to make use of climate model projections, but also take account of the uncertainty in them.

“There are good physical reasons to expect events to become more extreme,” Head of Exposure Management & Reinsurance Trevor Maynard says in the report.

“For example, as the temperature rises the humidity rises, giving the potential for larger floods.”

The report says the frequency of heatwaves has increased in Europe, Asia and Australia, but drought is expected to decrease in northwestern Australia and central North America.

Lloyd’s says the climate is changing and it is imperative that any trends are considered and incorporated into catastrophe models. The report includes short articles by the major risk modelling companies.

“Rising sea levels around the world could have significant implications for insurers in the context of storm surge,” another modeller, RMS, says. It points out that Superstorm Sandy, which struck along the US east coast in 2012, broke 16 historical tide records.

RMS Senior Director Paul Wilson says climate change-induced sea level rises caused Superstorm Sandy's surge losses in New York to be 30% higher than they might otherwise have been.

Thanks to InsuranceNews.Com.au for this report

Ita losses hit $8.4 million

Insured losses from Cyclone Ita in north Queensland have reached about $8.4 million, according to the Insurance Council of Australia (ICA).

CEO Rob Whelan says 680 claims were received by April 15, with no further updates yet available.

Teams of assessors have travelled to Cairns and ICA sent a disaster recovery specialist to Cooktown to liaise with authorities and identify and resolve insurance-related issues.

Mr Whelan says insurers have been prioritising cyclone claims, and he urges cyclone-hit property owners to contact their insurers as soon as possible.

ICA has also echoed warnings from Queensland Attorney-General Jarrod Bleijie about scammers going door to door offering unsolicited repairs.

The Category 4 cyclone made landfall in an area of relatively low population near Cooktown on April 11. It then moved down the coast, causing power outages, flooding and damage to sugarcane and banana plantations.

ICA has declared Ita a catastrophe for areas of north Queensland, meaning insurers give priority to cyclone claims.

Product disclosure a failure, NIBA tells inquiry

Regulators are now coming to realise that product disclosure obligations don’t work, don’t result in better informed consumers and don’t lead to them making better decisions about financial products, NIBA has told the Financial Services Inquiry.

NIBA's submission was filed on Monday, and advocates greater promotion of the valuable role qualified insurance brokers can play in providing advice to consumers on their insurance needs. It is NIBA's belief that product disclosure obligations can only play a limited role in leading consumers to make better financial decisions.

NIBA's submission states: "No amount of financial literacy and education programs will produce ‘confident and informed consumers’ of risk insurance products – the community does not understand and appreciate the nature and extent of risk, and the community will never become familiar with the nature and extent of insurance products and policies that are available in the market.

“In these circumstances, NIBA respectfully submits that the only realistic way to achieve confident and informed consumers of insurance risk products is to promote financial literacy followed by the need to seek qualified, professional advice from a licensed adviser who is experienced and expert in risk and insurance matters In other words, an insurance broker.”

You can read more details about NIBA's submission here.

You can access NIBA's entire sumission here.

Australia to experience fewer but fiercer cyclones

Queensland and Western Australia can expect fewer, but more intense, cyclones in the near future, according to a recent study published by Nature.

Research out of James Cook University in Cairns shows tropical cyclone activity has reached an unprecedented low not seen in the past 550 to 1500 years.

But the findings backup earlier studies that predict climate change will also result in stronger cyclones.

Environmental Sciences Professor and co-author of the study Jon Nott says the findings indicate that the last 40 to 100 years of cyclone activity in northern Australia represented a comparatively quiet period in the longer-term history of cyclones in the region.

“These results confirm that Queensland’s coastal development guidelines are based on an unrepresentative period,” Professor Nott says.

“Buildings and infrastructure on low-lying coastal land in northern Queensland face a higher storm-surge risk than our planners and development authorities have allowed for.”

Top 10 Global Risks of Highest Concern in 2014

  1. Fiscal crises in key economies,
  2. Structurally high unemployment/underemployment,
  3. Water crises,
  4. Severe income disparity,
  5. Failure of climate change mitigation and adaptation,
  6. Greater incidence of extreme weather events,
  7. Global governance failure,
  8. Food crisis,
  9. Failure of a major financial mechanism/institution,
  10. Profound political and social instability,                                                                                                                                                                                                                       Source: World Economic Forum Global Risks Report, Ninth Edition

Does your Sum Insured take account of current building standards?

An issue has developed as insurers with the claims arising out of the fires in the Blue Mountains, west of Sydney, in October 2013. Over 200 houses were lost in these fires, and the total insurance cost is estimated to be over $183 million.

As property owners and their insurers are starting to consider rebuilding, they are faced with increased building standards that have been introduced in the past 4 years. The building standards apply to new buildings (which includes the rebuilding of residences lost in the fires) and major renovations/repairs in areas that may be affected by fire, and operate to increase the cost of rebuilding. This has led to a number of properties being underinsured in the Blue Mountains area.

Other parts of Australia are also faced with building standards that have been changing over time, including areas likely to be affected by major storms and cyclones.

It is critical that we insurance brokers discuss the sum insured with our clients, and in particular when the cost of replacement is being estimated, we take careful account of current building standards that may be applicable to the property. Knowledge of local requirements will be critical in this regard, as the building standards are mostly applied and enforced by local councils.

Happy new year, for employers

It appears that 2014 will be more eventful than 2013 in the employment law and workplace relations area. So what can we expect?

New anti-bullying laws

There is the commencement of the new anti-bullying laws on 1 January 2014. It is likely that a large number of applications will be made to the Fair Work Commission in the first year of the new anti-bullying laws. This area will develop quickly, providing further guidance on the meaning and operation of these laws. Bullying will continue to dominate the employment law and workplace relations landscape in 2014

Privacy

Changes to the Privacy Act 1988 from 12 March 2014, will see the introduction of the Australian Privacy Principles (which will replace the current National Privacy Principles). There are changes regarding privacy policies and notices. There will be further regulation around cross-border data disclosure. The changes largely relate to increased transparency in the management of information.

The use and disclosure of employee information and records will vary from business to business.,

Productivity Commission Review

The current Federal Government intends to have a Productivity Commission Review of the Fair Work Act under the pretext of improving the legislation. It is expected this will commence in or about March 2014. The terms of reference for that review have not yet been released.

While the government has stated that any changes recommended would not be considered until the next election, we do not expect any real amendments to this Act, but they have already broken many promises so far such as education funding, reducing government debt and dealing with climate change.

Christmas Risks because Christmas isn’t always fun and games

There are risks to you with Christmas. In fact the risks could be greater to you than at any other time of the year. The Institute of Risk Management (IRM) has compiled a list of the most commons risks facing most people and of course how to manage them as follows:

Debt: Hard to avoid at Christmas. The IRM recommend managing this risk by limiting gifts to one per family. Alternatively encourage everyone to make their gift. It will save adding to the credit card bill.

Being shocked: Not just at the cost of goods or your weight gain, but high hazard things like Christmas lights and other gadgets plugged into the mains. It not only puts your power costs up but places the home power circuit under pressure. To avoid a shock and potential trip to Emergency, it may be time to upgrade the lights, unplug occasionally and make sure they aren’t left plugged in and unattended for long periods.

Crime: Many Mobile devices, such as smart phones and tablets will be on the wish list this year. However they contain a lot of sensitive data and a host of personal information. They are also targeted by crooks. So if giving or receiving these as a gift, the Institute of Risk Management recommends packaging it with security software.

Overindulgence: With the amount of parties and all the treats on offer, resistance can be futile. However to avoid gaining a waistline to rival that of Santa Claus,  the Institute of Risk Management suggests balancing this extra intake with additional and regular exercise.

Embarrassment: Having a good time at the staff Christmas party or family function often involves the consumption of plenty of alcoholic beverages. This can sometimes to lead to uninhibited affections or instead negativity surfacing. This can sometimes lead to a loss of temper and aggression ending in dramatic and unwanted situation. Then the regret and illness the next day. Opting for drinking less could mean avoiding that awful ‘day after’ moment.

Preparing for severe weather

 

As we enter summer, a time of more severe weather events, one insurer is prepared to help you deal with weather events like bushfire, flood and cyclone. 

They have prepared a guide to give you insight into 2013’s weather risks – including bushfires, floods and cyclones – and how they will help you if impacted by an event.

This guide is designed to help inform discussions with you to help better understand your risk and ensure you have the right level of insurance to protect your property and assets, should the worst-case scenario occur.

They have also prepared checklists and claims information to help our  customers prepare for bushfires and cyclones and minimise the risk of damage to their property and business.
 
Contact us for a copy 

Disputes with the Ombudsman miniscule when dealing with Brokers

Ombudsman’s report confirms Brokers’ low dispute rate
Statistics recently released by the Financial Ombudsman Service (FOS) reveal  that of all the general insurance disputes accepted by the ombudsman during 2012/13, just 0.66% were between small businesses and brokers.

In comparison, there were more than 300 disputes between SMEs and insurers.

This low number could well reflect the quality of advice and guidance broker clients receive. The bulk of disputes involved decisions made by the financial service provider making up two thirds of cases heard by the ombudsman in this category.

These statistics should reassure our clients that our advice not only helps you make the right decisions but could also play a role in protecting you from troublesome disputes. 

Christmas and employee risks

Don’t get your tinsel in a tangle

By Lea Fox, Employsure Documentations Consultant 

Christmas is just around the corner and it’s timely to review leave provisions to ensure employers are aware of employee entitlements as well as employer obligations during this time.

Christmas Shut Down

Most modern awards and agreements allow for an employer to make a direction to an employee to take annual leave during a Christmas shut down, as long as certain requirements are met. This generally includes the requirement to give each employee notice in writing of the shutdown and the requirement to take leave, with notice required between 4 weeks – 3 months in advance depending on the award.

If an employee doesn’t have enough annual leave to cover a shutdown period, the employer can either:

  • ask the employee to take annual leave in advance, or

  • ask them to agree to unpaid leave.

Paid Annual Leave in Advance

In granting leave in advance, it is important for the employer to ensure their business is not financially disadvantaged if the employee’s employment subsequently ends without having sufficient accruals of leave.

The employer must exercise caution when granting leave in advance. Where the employment of an employee ends whilst the employee still has a negative leave balance, it can be difficult to recover amounts owing to the Company. In some instances, an award may refer to taking leave in advance and the employer’s right to recover moneys. However, such a provision does not appear in all modern awards.

Rapid response to Bushfires by Insurers

Rapid response to bushfires but costs linger

by Meenal Kumar | Broker Buzz 30 Oct 2013

The insurance industry is earning plaudits for its response to the NSW bushfires, with some small business claims being paid within an incredible one-hour timeframe.

Broker Buzz spoke to one Penrith-based broker who put in a general property claim on behalf of a client at 9:45am on Monday morning and had the final paperwork settled on the claim by 10:45am the same day.

“The claim was worth $5000 and covered tools the client uses in their business,” the broker says.

“The insurer responded swiftly to ensure our client was back on his feet as quickly as possible.”

This response and many like it have earned the industry high praise by NSW Bushfire Recovery Co-ordinator Phil Koperberg, who says: “The insurers are doing the right thing. They’ve been more than reasonably helpful in the main and I’ve not heard of any exceptions.”

“They have been very, very responsive. I know that a number of claims have already been settled.”

Insurance Council of Australia (ICA) CEO Rob Whelan says insurance assessors have already visited nine out of 10 damaged properties, with well over 1000 claims made so far.

“Insurers have responded incredibly quickly and we believe this is in the best interests of residents and business owners affected by the bushfires,” he says.

BOM predicts 'typical' cyclone season

Australia is set for a “near-average” cyclone season this year, according to the Bureau of Meteorology’s annual forecast.

Neutral conditions in the tropical Pacific Ocean prevailed from July to last month and are expected to continue through summer, leading to a 57% chance of above-average tropical cyclone activity, the bureau says.

“There is currently nothing in the broad climate drivers to suggest anything but a typical tropical cyclone season for Australia and the sub regions.”

A typical season runs from November 1 to April 30 and averages about 11 cyclones, with some likely to cross the coast.

In the eastern region, including the Queensland coast, there is a 53% chance of an above-average cyclone season, according to the bureau. The northern region, including Darwin, has a 52% chance.

The neutral state of the tropical Pacific Ocean reflects the absence of either El Nino or La Nina conditions.

Early bushfires highlight importance of insurance

Yesterday’s bushfires around Western Sydney and South East Queensland are a sobering reminder to consumers and property owners to make sure they have adequate insurance arrangements in place ahead of the coming summer season, according to the National Insurance Brokers Association (NIBA).

Following a hot 2012 summer and a dry 2013 winter, the fires in Sydney commenced on the back of the warmest overnight and day temperatures recorded so early in spring in more than 100 years. In some places temperatures reached in excess of 31 degrees.

Two homes were destroyed in the fires and meteorologists are warning that Sydney could continue to see warmer than normal conditions for most of September and October, increasing the risk of bushfires.

Roma has flood embargo removed

Vero, as part of the Suncorp Group believes flood mitigation infrastructure is essential to ensure insurance premiums can remain affordable in western Queensland.

Last year they made the decision to stop writing new business in Emerald (4720) and Roma (4455) until local councils could guarantee that adequate flood mitigation would be put in place.

A significant milestone has now been reached in improving flood mitigation in Roma with construction of a levee underway. As a result Vero will start writing new business for Home and Contents in Roma (4455) from 24 September 2013, using existing risk levels to price premium.

Time to abolish Taxes on Insurance

An extra 20% of taxes are added onto all Queenslanders Insurance policies. For every $100 in premiums you pay, Goods and Services Tax (GST) is added to make $110 and then a further 9% is added by the Queensland Government in the form of a “Stamp Duty” to make a total of $119.90. This is also not taking into account a Terrorism Levy on all Property Insurance.

While the Queensland Government can point out that we still have the lowest Stamp Duty in Australia, along with NSW at 9%, it does not get away from the fact that the Insurance Industry was told prior to the introduction of a GST, that this tax would replace inefficient taxes such as State Government Stamp Duties, it did not happen. We were tricked by the Conservative Government at that time.

All property owners should protect their assets with Insurance, every person needs to have liability cover in case they accidentally cause injuries or property damage to another person. However adding $20 on top every $100 of premiums charged by Insurance Companies is a disincentive.

The Scam watch web site

The Scamwatch website provides information on common scams that you should look out for.

Learn how to recognise and protect yourself from the following scams:

Online scams, 

Auction and online shopping scams,

Banking and online account scams,

Mobile phone scams,

Identity theft scams,

Personalised scams,

Door to door and home maintenance scams ,

Classifieds scams,

Social networking scams ,

Dating and romance scams,

Charity scams,

Lottery and competition scams (fake prizes),

Chain letters and pyramid scams, 

Investment scams (get-rich-quick), 

Money transfer requests ('Nigerian' scams),

Health and medical scams,

Job and employment scams,

Small business scams, 

Check the SCAMwatch radar for the latest scams. Also check the current consumer alerts section of our website.

Queensland Stamp Duty set to rise

Did you know Queensland Governmentplans to increase stamp duties on general insurance products by 1.5%.

It has been reported that stamp duties will rise from 7.5% to 9%, taking effect from 1 August 2013.

The problem with such stamp duty rises is that it adds to Queenslanders’, cost of living by forcing up the price of insurance. This leads to an increase in the level of underinsurance and non-insurance in Queensland, particularly in areas regularly exposed to cyclones and floods who are already facing increases in base insurance premiums along with the multiplying effect of such taxes.

The fact is, Stamp duties are inequitable, highly inefficient and unfair.

Robert Cooper has been named one of Insurance Business magazine’s Elite Brokers.

Robert Cooper of CPR Insurance Services has been named one of Insurance Business magazine’s inaugural Elite Brokers.

The new issue of Insurance Business magazine hits desks today and he is featured in the cover story: 'Australia's Top 30 Elite Brokers'.

A place in the Insurance Business Elite Brokers ranking is a recognition of his professional standing as one of the leading brokers in the Australian insurance market.
 

Catastrophes report for April 2013

The global catastrophes in April were dominated by an earthquake in China and two in Iran.

There were also other earthquakes recorded for Japan, Afghanistan and Hungary during the month.

Parts of the U.S. suffered severe hail and flooding damage during April, although there were fewer tornadoes than expected.

Then there was a major building collapse in Bangladesh with its cause yet to be determined but thought to be caused by inadequate construction.

Australian sues McDonalds over Coffee Burns

An Australian woman is suing McDonald’s over burns to her leg that she says were inflicted by a cup of coffee.

The lawsuit is very similar to that made by Stella Liebeck in 1994, against McDonald’s in the United States. Liebeck won US$2.8million in compensation, after suffering burns to six percent of her body. The case, and its outcome, attracted significant media coverage at the time including a version of the scenario on Seinfield.

Jessica Wishart, who purchased her cup of coffee in Renmark in 2009, claims to have suffered second-degree burns which she says resulted from coffee spilling onto her thighs – due to the intense heat emanating from the cup and the failure of McDonald’s to properly secure the lid.

Her District Court statement of claim says that she was admitted to hospital, and that she “has permanent scarring and had difficulty walking and that she can no longer drink coffee, or go into any McDonald’s stores".

Products liability insurance can take away the risk of having to spend large amounts of money defending against such claims.  With product liability insurance, there is still going to be loss of time dealing with it that will not be covered, but at least you have the resource to defend these types of allegations. If you actually end up losing at least the insurance company will cover the costs. 

This cases illustrates the importance of product liability insurance to any consumer-facing businesses. 

Cyber Attacks - increasing in severity and frequency

In late March 2013, a massive cyber attack took place, not between warring nations but between an anti-spam group and a hosting service that rents server space to spammers. It resulted in what experts are calling the largest denial-of-service attack in the history of the Internet.
The players were Spamhous, a European group fighting spam, and Cyberbunker, a Dutch company that rents server space to a wide variety of clients, including those that send out spam. When Spamhous added Cyberbunker to its blacklist, war broke out.
Swarms of computers suddenly started sending out huge data streams. In this latest attack, cyber warriors exploited the Internet's Domain Naming System (DNS), bombarding Spamhous' servers with data requests. Very soon, the servers couldn't be reached by anyone else.
But the effects didn't stop there. Many Internet users in Europe and North America found the Internet suddenly slowed or ground to a halt. Some found streaming a video on Netflix next to impossible. Others had trouble reaching websites they visit on a daily basis.
 

NTI issues challenge to cut accidents involving trucks over Easter

 Australia’s leading truck insurer, National Transport Insurance (NTI), has issued a safety challenge to all holiday-makers taking to the roads this Easter.

Since 2009, the number of accidents between a truck and a third party over the Easter period has increased by more than 60%.

NTI is challenging road users and the trucking industry to reduce this during Easter 2013.

Mr Clark urged the trucking industry to also step up over this busy time, when traffic on national highways increases. “With greater congestion on our major highways over Easter, NTI urges the thousands of professional drivers to remain acutely aware of conditions and the threat of less experienced road users as they deliver the necessary supplies for the Easter holidays,” he said.

He recommended motorists keep in mind four tips when sharing the road with trucks this Easter:
1. Don’t cut in: Trucks are heavier than cars, so need more space when stopping. For example, at 100km/hr a truck needs an extra 30m to come to a stop compared to a car travelling at the same speed.
2. Give trucks room to turn: Some trucks need extra room at corners, intersections and roundabouts. Trucks over 7.5m must carry a sign saying “Do Not Overtake Turning Vehicle”. This means the truck can legally use two lanes to make their turn, and may need to turn left across your path to turn left.
3. Be aware of blind spots: Remember – if you can’t see the driver’s mirrors, he/she can’t see you!
4. Overtake with care: It takes about 25 seconds to overtake a prime mover on the open road. That’s a long time if you’re on the wrong side of the road – and even longer if the truck is a B-Double or B-Triple. Make sure you have the time and clear visibility.
 

Electrical safety risks in ceiling spaces - householders tradespeople

There are many risks concerning Electrical Safety where anyone from Insulations Installers, Antenna Installers and Electricians often work in ceiling spaces. Recently there was a fatal incident at a school in which an electrical worker was electrocuted while working in a ceiling space.

The worker was installing communication cabling in a ceiling space. An electrical cable with damaged insulation made contact with a metallic plate, energising parts of the building structure to which the worker was exposed.

The Electrical Safety Office is reminding all householders and tradespeople to take extra care before entering a ceiling space. 

If you are planning to enter a ceiling space, think about where electrical cables and other electrical equipment might be located.

A risk assessment and safe system of work should be used to manage electrical risks. Where possible all electrical supply should be isolated before entering the ceiling space. A risk assessment must include measures to identify where electrical equipment is located and the control measures implemented to ensure this equipment is not disturbed.

In all contracting situations both the business engaging the contractor and the contractor must take appropriate steps to minimise any exposure to health and safety risks that are identified.

  

Overheated Extension Cord Causes House Fire

Be careful of those extension cords. In another reminder about the risks of electrical fires in homes or business, Authorities in the USA say an overheated extension cord is to blame for a house fire in Lincoln, Nebraska. It is an event that could easily happen anywhere else in the world including Australia.

Authorities say the house received extensive damage. No one was injured and authorities estimate the damage at $75,000. They were lucky despite the inconvenience of not being able to live in their home for a little while. No one wants to lose everything or the lives of their loved ones.

It is a reminder to get all your electrical cords regularly tagged and tested, along with the rest of your electrical wiring and electrical switchboard on a regular basis.

If you are looking for someone to do this for you, let us know and we can get experts in this area to call you. 

Chartis returns to AIG name

Chartis Australia has gone back to being called AIG Australia Limited name as part of a global rebrand sparked by their strong economic recovery in the past four years. 
Internationally, AIG has completed the repayment to the US Government of US$182b, as well as bringing US government ownership in the company to just under 16% (September 2012). At current valuation, the remaining government ownership is worth approximately US$8b.

The rebrand follows research conducted with global customers and partners that revealed the AIG brand to be a stronger representation of the company's objectives.  

Are you dealing with WHS changes?

Unfortunately many organisations in Australia are unaware of their obligations under the latest workplace health and safety (WHS) laws. Some have chosen not to invest in compliance management. Their excuse is similar to the reasons some organisations do not take out insurance because “it will never happen to them”.

The WHS laws are being implemented and enforced in most Australian jurisdictions (including Queensland). Those States not yet signed up are planning to introduce them shortly or still giving strong commitment to their principles.

 One of the key features of the new WHS laws which you should take note of is the move away from the employment relationship. The laws now dictate that a Person Conducting a Business or Undertaking (PCBU), owes the primary duty of care to each of its ‘workers’. This means not just an employer, but also a Principal engaging contractors.

Putting recent catastrophe losses into perspective

The natural catastrophes of 2011, including the Tohoku earthquake in Japan, flooding in Thailand, earthquakes in New Zealand, and floods in Australia, resulted in $110 billion in insured losses making it the second-highest figure ever recorded from global natural catastrophes,
according to Swiss Re.

A new report from AIR, a worldwide catastrophe modelling firm, explains that there is almost a one in thirteen chance that the global insurance industry will experience this sort of size loss level or even greater each year from now on. 

Two years after the floods - the situation

The second anniversary of the devastating floods that hit Queensland and Victoria in 2011 is taking place over the week from 10 January 2013.
More than 66,000 claims were lodged with insurers following the Queensland and Victorian floods, most of which were resolved without dispute.
However, as an external dispute resolution scheme that provides free, fair and accessible services to consumers who are unable to resolve disputes with financial services providers, the Financial Ombudsman Service (FOS) has received disputes about these events over the past two years.
The most common issues have been whether people were clearly informed of their insurance policy coverage, whether people had received all pertinent documentation regarding their insurance policy and the use and analysis of hydrology reports and the application of exclusion clauses in insurance policies.
Each dispute is unique and its resolution depends on the particular facts involved including the location, topography, time of inundation, and wording of the insurance policy in question. In reaching a Determination, FOS looks at all available information provided by the parties and in many circumstances conducts site visits.
One of the more complex issues surrounding the Queensland floods related to the release strategy in relation to the Wivenhoe Dam. FOS weighed up the available evidence and took into account the findings of the Queensland Flood Commission before determining that the heavy rain that fell from 4am on January 11, 2011 prompted engineers to later adopt the ‘W4’ release strategy at Wivenhoe Dam, which in turn was the trigger that led to the flooding of many properties. As a rule, therefore, those properties flooded within 24 hours of 4am on January 11 were likely to be covered if their insurer had provided flash flood cover within 24 hours of commencement of heavy rain. If on the other hand, the insurer hadn't provided that level of coverage, then the consumer quite possibly would not have been covered.

Hacking warning for small business

The Australian Federal Police (AFP) are warning businesses to ensure their computers are secure after a series of recent hacking incidents.

Small businesses are increasingly becoming a target for cyber criminals due to the higher likelihood of vulnerabilities in their security and systems.

It is recommended businesses should:
 

A bigger Bushfire season approaches

The Insurance Council of Australia (ICA) is warning that large spring bushfires and predictions of a hot, dry summer are sending a strong reminder to households in fire zones to prepare for a higher risk this bushfire season.

The ICA said Australia is moving towards hotter spring and summer weather, and recent bushfires were evidence of the high fire risk.

“The Bureau of Meteorology is warning the chances of bushfires this spring and summer are much higher than the previous couple of years,” said ICA CEO Rob Whelan.

Householders in areas at risk of bushfires should take steps to prepare now. They should make sure their properties are physically prepared, and this should also serve as a reminder to review insurance needs.”


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New Fair Work Act Handbook

We know that if you are employing staff there is a particular piece of legislation that you must abide by where failure to do so can result in severe penalties. The Fair Work Ombudsman has assisted by publishing a new handbook to assist employers better understand the fair work legislation and their obligations under workplace laws.
It is designed to assist employers prevent and resolve workplace issues in their businesses, the handbook provides an overview of the aspects of the Fair Work Act that employers must be familiar with.

Another solution is to take out an Employment Practices Liability cover. This can be an extension to Management Liability but this still requires some knowledge on your part. Or have someone do it for you with a more comprehensive "stand alone" package with a Risk Management component such as Employsure's product.

New Unfair terms legislation to be introduced

Federal Assistant Treasurer David Bradbury has announced that the Gillard Government will legislate to protect consumers from unfair terms in general insurance contracts. Further consideration will be given to the application of unfair contract terms laws to life insurance contracts in the future.
The new laws will:
• be introduced into the Insurance Contracts Act 1984.
• be based on the unfair contracts provisions in the Australian Securities and Investments Commission Act 2001, but will take account of the unique features of insurance contracts.
• allow consumers, or the Australian Securities and Investments Commission (ASIC) as the regulator, to challenge a term in the courts.
• give ASIC a range of enforcement powers to administer these new laws and if a term is found to be unfair, the insurer cannot rely on that term and the court may also order other remedies to help consumers.
• provide for an adequate transition period, and will apply to all new and renewed insurance contracts entered into after commencement.
• be released in draft for consultation in 2013.

In principle, the reforms should be good news for insurance brokers and their insured clients who will be better protected once the legislation takes effect.
 

After the Storm

The day after a storm, you do not want to regret wishing you had read your homeowner's insurance policy more closely but that is exactly what happens particularly if you have insured direct with an insurer rather than use a Broker. It is then you learn that even though you saved lots of money with such a cheap product, you do get what you pay for. With major Storms comes wind and water damage claims resulting in a huge number of claims being lodged all at the one time. All wanting to be dealt with and paid out straight away.
There are often questions and disputes about whether damage was caused by excessive rain, wind or flooding. Homeowners often find themselves being told that damage to their home is not covered because it was caused by flooding, which is not generally covered in homeowner’s policies. With many insurers, you need to specifically request the policy to be extended for flood insurance for that.

But here is the difficulty. After much pressure from the Federal Government, many insurers now automatically include Flood cover but they will cost this risk. In many instances, this pushes the cost of insurance much higher causing the Insured to seek out cheaper cover elsewhere.

Chubb launches new policy for Ultra High Net Worth clients

Not all house and contents policies are the same, just as not all clients are the same, even high net worth clients. To ensure your most important clients are given quality coverage and high levels of service, Chubb is pleased to announce the release of the Masterpiece Signature policy with effect from the 1st February 2013.

Masterpiece Signature provides Chubb’s broadest level of coverage and service to individuals with significant assets to protect. A dedicated team of Chubb underwriters has been established to handle your Masterpiece Signature client’s insurance requirements and prioritised claims and appraisal services are in place, providing the peace of mind critical to your on-going client relationship.


 

Brokers are better than direct Insurers

Did you know that the Financial Ombudsman Service reports that it handles more than 25,000 disputes annually? Did you also know that insurance brokers are responsible for only a tiny fraction these?
The Financial Ombudsman Service’s 2011-2012 annual review revealed it has accepted 25,298 disputes into its formal dispute resolution process, where a customer had not been able to resolve a dispute directly with their financial services provider. This was up 24% on the previous year.
When broken into sectors, general insurers were responsible for 7,591 complaints, second only to banks who accounted for 12,210. Life insurers also had 851 complaints.
General insurance brokers were responsible for a tiny 123 complaints. This means that general insurance brokers accounted for less than 0.5% of all complaints received by the Financial Ombudsman Service in this 12 month period. General insurers were responsible for 30%.
 

Have someone do the shopping for you

More Australians are looking to shop around for a new insurance provider rather than simply renew their existing cover.

The majority of household Insurance policies are automatically renewed without approaching other insurers. However, there is an increasing trend to shop around prior to policy renewal, according to the latest findings from Roy Morgan Research’s General Insurance Industry Report.

In the 12 months to August 2012, 14% of households approached another company prior to renewal compared to 10% in 2008.

Making Experts more Accountable for their advice?

New York didn’t expect a severe storm like Sandy. We can’t rule out the possibility of these catastrophic events happening to our major cities. We need to look at how to manage these increasing risks.

We need our Scientists even though very limited research and development funding is available to them to come up with innovative methods to prevent loss of life. The extent of damage and how they spread and propagate is difficult to estimate accurately. However if properly supported and funded engineers and scientists, can come up with better predictions of these events.

Despite this, we did hear of the news of six Italian scientists charged for manslaughter and gaoled for six years each for failing to predict the intensity of a 2009 earthquake that killed over 300 people.

Allegations were made against the Engineers of Wivenhoe Dam in Queensland. They were forced to defend themselves, although they had mentioned the difficulty of predicting these extreme events.  We also do not want our scientists to no longer provide advice to us in the future. We have already seen how many Scientists have been heavily criticised for daring to relate Climate Change to these severe weather events.

  

Worst Passwords of 2012

According to SplashData, here are the Worst Passwords of 2012:

1.password
2.123456
3.12345678
4.abc123
5.qwerty
6.monkey
7.letmein
8.dragon
9.111111
10.baseball
 

More Householders are taking out Flood cover

According to new data released by the Insurance Council of Australia (ICA), many more consumers with householder insurance now have policies with flood insurance included.

Nearly four in five Australian household insurance policies now have flood insurancereported ICA chief executive Rob Whelan. He said the data demonstrates the variety of policies in flood insurance available to all Australian property owners, formatted to suit individual circumstances. Consumers are making well-considered decisions about their risks and their insurance requirements.

The home and contents insurance market is highly competitive. Consumers can choose to purchase products with flood cover as a standard inclusion, products that allow the customer to opt out of the flood component, or products that exclude flood from the policy, according to Mr Whelan.

The purchase of flood insurance had grown significantly since 2006, said Whelan, when it was a relatively new residential product and only 3% of policies had flood cover. 

Car theft figures rise nationally

The number of motor vehicle thefts in Australia increased in the last financial year.

A total of 17,578 vehicles were stolen for profit in 2011/12, up 1127 or 7% on the previous year, according to the National Motor Vehicle Theft Reduction Council (NMVTRC).

Some 42,296 vehicles were stolen for short-term use, an increase of 1965 or 5%.

Social media ranked as a top source of risk

It has been a nasty time for the modern digital medium. Tough New Zealander Charlotte Dawson @MsCharlotteD recounted an incident on 60 Minutes that put her into hospital, the ACCC announced that Businesses that don't monitor and control their social-media posts will be in trouble, and social media giant Facebook revealed that the global currency of social media, the ''like'' button, has in fact been inflated by fake bots,

The image of a marketer's paradise with social media previously rarely considered is now seen as a risk thanks to the recent warning from the Australian Competition & Consumer Commission. Now big companies need to correct ''misleading Facebook posts'', combined with the increasing social-media crisis engulfing local brands has started whispers that some organisations may vacate the social-media field in which they be part of. Not surprisingly, social media is now ranked as one of the top sources of risk, level with financial risk.

Australian businesses need to be more proactive about acknowledging and managing the risks associated with social media if they wish to safeguard brand and reputation, protect information and intellectual property, and mitigate the chance of legal actions,
 

Claims fall sharply in year to June

Gross incurred claims on Australian general insurers fell 22% to $27.9 billion in the year to June as the industry rebounded from last year’s natural disasters.

The figure is still up more than 20% on 2010, when $22.8 billion of claims were made, according to data compiled by the Australian Prudential Regulation Authority (APRA).

Net incurred claims rose 11% to $19.7 billion, with APRA noting higher gross claims in 2011 were offset by increased reinsurance recoveries.

The figures cover 112 insurers and 12 reinsurers. Their underwriting combined ratio was 98%, compared with 96% last year.

ASIO say many cyber attacks go undetected

Australia's chief spy has warned businesses to be on the alert for cyber attacks and corporate espionage.

David Irvine is the director-general of the Australian Security Intelligence Organisation (ASIO) and says many cyber attacks are going undetected by local security agencies.

This comes not long after $25 million was recently stolen from Australian credit cards by overseas hackers.  Company information, like planned investments and potential weak points of a business, were the constant targets of hackers, he warned.

He urged Australian businesses to be more proactive in protecting their company's information. He said senior management needs to consider very carefully their security culture and assess the threat and potential damage if they don't take action.

Insurer expects large increases in premiums

Insurance Australia Group has made the prediction there will be double-digit rises in insurance premiums in the next year, due to increasing global reinsurance costs.

Reinsurance price increases were only now working their way through the system, but further measures were needed to protect margins according to IAG’s Mike Wilkins. He said they have had a tough few years, mainly driven by external market factors, particularly perils and higher reinsurance costs, but they have started to come through it.

El Nino likely for later this year

According to the Bureau of Meteorology (BOM), El Nino conditions will affect the East of Australia towards the end of August.

El Nino events are linked with the likelihood of drier conditions and can be linked to the risk of heightened temperatures, drought, crop failures and bushfires. When we are in an El Nino period, large parts of eastern Australia are drier than normal during winter and spring, while daytime temperatures in southern Australia tend to be warmer. Therefore the likelihood of heatwaves and bushfire risk increases.

With the good rainfall of the past two years, we do have some in reserve against drought but it can also increase the risk of bushfire because of the extra growth in the Bush, from the two wet years of 2010 and 2011.

Time to consider Trade Credit Insurance

The credit risk environment is continuing to deteriorate but did you know that we can provide an Insurance solution for you? It is called Trade credit insurance.

There are a few insurers who can offer this cover and it is certainly worth considering, particularly if you are dependent on your debtors paying up quickly to maintain cash flow. However, what happens if that debtor goes into receivership because they are unable to pay you?

It has been reported by insurers that there has been a 20% increase in the number of credit insurance claims and a 64% increase in the dollar value of claims for the past three months of 2012. The failures of Retravision Southern, Wow Electrical, Kell and Rigby along with the Hastie Group, have certainly contributed to this. With the recent failure of Darrell Leigh, it will be interesting to see what further impact there will be on claims for their Creditors who are owed money.

Not For Profit Legislation coming

The Government has referred the draft Australian Charities and Not-for-profits Commission (ACNC) legislation to the House of Representatives Standing Committee on Economics for an inquiry over the Winter Parliamentary break.

Assistant Treasurer, the Hon David Bradbury MP, says any recommendations made by the committee will be considered before introducing the legislation later in the year, ahead of the ACNC’s 1 October 2012 start date.

The ACNC will initially regulate only charities (including public benevolent institutions), but the legislation establishes a regulatory framework that can be extended to all not-for-profit (NFP) entities in the future.

Contractors $197k back-pay case due to wrong classification

A business in Archerfield was recently audited by Fair Work Inspectors and ordered to issue $197,500 in back-payments to employees that the Ombudsman said were incorrectly classified as “independent contractors”.

They ordered 11 employees receive between $6,401 and $50,525 in back-payments.

Fair Work inspectors did determine that the mistake was not deliberate. The employer even co-operated to voluntarily rectify the issue which demonstrated this was a case of compliance oversight.

Financial Ombudsman Service - disputes on the rise

FOS is the Financial Ombudsman Service which deals with disputes made to it after an Insurance Company has declined or not adequately settled a claim.

It is a concern that Insurance Companies have yet to appropriately deal with their claims approach or service. Recent statistics from the Financial Ombudsman Service (FOS) show total disputes across the financial services sector referred to the ombudsman were up 29% for the first quarter of 2012, compared with the corresponding period in 2011.

FOS cases have risen steadily over the past year, only reducing slightly in the last part of 2011.

In 2011 the number of disputes increased 13% from the first quarter to the second quarter. Then 12% from the second quarter to the third quarter, before reducing by 12% in the final quarter of the year.

However already the first quarter of 2012 disputes referred to FOS were up 16% on the final quarter of 2011, with 9590 new disputes lodged.

CPR Insurance Services nominated for award

We have become a finalist in the Quest Business Awards for 2012.

This is a great honour in only our second year of business.

We thank everyone who voted for us.

It would be fantastic if we won the award but just making the finals means alot to us.

Not enough buying Cyber Risk Insurance

Nearly three in four corporate risk managers are not buying insurance policies to cover data breaches and damage to customers’ privacy despite the rising threat of hacking, according to a recent survey.

In the USA, companies are largely ignoring the cover. According to consultants Towers Watson in their annual review of corporate risk, those who are taking out “cyberinsurance” are buying policies with only limited protection in case of an attack.

The Towers Watson survey was conducted in February and March 2012, covering companies across industries. The majority of them have annual revenue in excess of $1 billion.

Wilston Grange Business Community

 

 The Wilston Grange Business Community  now has its own Web site and Directory. Just click on the Logo to be taken to the site.

If you have a business in the Wilston Grange area, you are welcome to join. We also hold a Business Breakfast on the first Wednesday Morning of each month at one of the local Cafes. The next one will be held 2 May 2012 at Cafe Conti at 7am.

 

 

Wilston Grange Business Group

If you own or run a business in the Wilston Grange area in Brisbane North, you are welcome to attend a breakfast meetingstarting at 7am at Cafe Conti on 7 March 2012 in Wilston Village, Kedron Brook Road.

Invitation to the event - Click here

Firstly, we will be discussing the future direction of the group and electing new faces to the committee.  If you are a local business, it is worth getting to know other local businesses. In the Wilston Grange area, they are a terrific bunch of very friendly people.

Secondly, we have a wonderful speaker - our new Wilston Fair Coordinator - Sally Porteous (from Red Lanyard Events). Sally is super-keen to update you on the exciting opportunities available for you in the 2012 Wilston Winter Magic Fair on June 3rd.  It is set to delight and mesmerise you with all the wonderful things about Wilston and surrounds - our food, friends and families.  The Fair naturally will provide us local businesses and organisations with a unique opportunity to showcase ourselves to the local community.   

Come along and find out how your business may become involved with such a fun event - Wilston Winter Magic Fair in Wilston Village

ABN email scam circulating

A number of fraudulent emails have been circulating recently targeted directly at members of the Australian public and those with businesses. The emails are purporting to be sent by the Australian Taxation Office, attempt to trick users into clicking links contained in the body of the email by claiming that there have been changes made regarding either the use of an ABN or changes regarding the submission of tax lodgements.

While the links appear to be to the Australian Business Register website, if the user hovers the mouse cursor over the link, the link actually displays a completely different destination website. If a user clicks on the links contained within the emails they are taken to a malicious website which will infect their computer with malicious software, also known as malware.

Malware will potentially perform harmful activities such as stealing passwords or other sensitive information and relay the stolen information to criminals, or even damage the user’s data and operating system. Visit Stay Smart Onlinefor more information. 

Congratulations to the Cooper Family

Congratulations to the Coopers Brewery for winning the title as the best family owned business in the world.

In 2012, the Coopers Brewery will be 150 years old and it is not just the name that makes it the best Beer in Australia. It is also the biggest Australian owned Brewery in the country!

This Cooper family has given much inspiration to another Cooper family. Us! Cooper Professional Risks Pty Ltd trading as CPR Insurance Services is another family owned business, and while we are now in our second year only, we are buoyed by the success of any "Cooper" around the world.

2011 was a great year for CPR Insurance Services and we expect even better in 2012. We thank all our clients, insurers, friends and relatives for their wonderful support and wish you all a safe christmas period and a happy new year.

$16 Million Fraud shows it can happen to any one

Police have detained a public servant who allegedly embezzled $16 million from Queensland Health.

An intensive manhunt for the 36-year-old, ended on 12 December 2011 early in the morning at 3:30am when he was detained outside a unit in New Farm, Brisbane.He is now in custody and is being questioned by police. We are waiting to hear if charges have been laid.

This morning Queensland Police Minister Neil Roberts said that the case was "one of the most significant fraud cases" in Australian history. He said a "substantial proportion" of the money involved had already been recovered but we do not yet know how much. 

Parliament Passes Business Names Legislation

Legislation passed by the Australian Parliament 13 October 2011 means that for the first time Australian businesses will soon be able to pay just one fee and have only one process to register their business name nationally.


“This is a commonsense and practical reform that will cut red tape and save time and money for businesses across Australia,” said Minister for Small Business, Senator Nick Sherry, in welcoming the passage of the Bill in the Senate. 

CPR announce a new addition to the team

Robert and Mandy Cooper are pleased to announce that Kathy Pushkareff has joined CPR Insurance Services as an Authorised Representative from 22 August 2011.

Kathy has more than 15 years experience in the Insurance Industry working as an Insurance Broker for a large city firm.  She has a Diploma of Financial Services (Insurance Broking).  She is dedicated to providing clients with solutions for all their General Insurance needs from small, medium and corporate accounts specialising in Community Organisations and Church Groups. 

Man gaoled for stealing $27 Million from a University

In a reminder for businesses to get their Accounting systems in order, a South Australian man today went to gaol for fraud against his employer.  

Christopher Wayne Fuss, 47, started misappropriating funds six months into his employment at Adelaide's Flinders University and continued for two years resulting in more than $27 million, has been sentenced to nine years in jail. 

Mick Molloy loses defamation case

In another example of defamation claims, former federal Labor candidate Nicole Cornes has won a defamation case against Channel 10 and comedian Mick Molloy. The comments Mick Molloy made on the television programme “Before the Game” in 2008 have now been found by a South Australian Supreme Court to be Slander. Ms Cornes claimed on-air comments Molloy made in 2008 questioned her fidelity and damaged her reputation, humiliated her and defamed her. 

Why are Insurance Premiums rising?

CGU have produced a very interesting booklet to explain to Brokers and clients why Insurance Premiums have begun to rise.

It gives a very good explanation about the things that have affected claims results in recent times.

As related in a previous post, you get what you pay for but as a Broker we are always seeking to get you the best possible cover at the best possible price. Competition keeps the prices down.

If interested in CGU's perspective, click on the link below.

Why are Premiums Rising?

Cyber Risks - the new Frontier

I am currently investigating what insurance solutions are out there for the risks now being found with hacking into private data, taking confidential details including credit card details and bringing down a Businesses Web site to the extent they lose revenue.

I have found one product through a market at Lloyds and I will look into it and advise shortly.

But in the meantime, check this link out which you may find helpful http://www.staysmartonline.gov.au/ 

There are dangers in buying cheap policies.

With Insurance policies - you get what you pay for.

Falling premiums, aggressive competition between underwriters and the large number of insurers mean policy prices become cheaper. This is great for our clients but cost savings in the short term may prove costly later.

Ten years ago (March 2001) HIH Insurance collapsed with $5 billion in debts. They had a reputation for being cheap. Many of their policy holders regretted choosing an insurance policy on price alone.

All Companies should analyse the risks their business faces and determine the scope of insurance cover required. As your Insurance Broker, we can help you to do this. While value for money comes into the equation, it shouldn’t do so if it means less protection.

One of the odder breaches of Copyright

The tattoo on Ed Helms' face is staying in the film of The Hangover: Part II because Warner Bros has settled the lawsuit brought by Missouri tattoo artist S Victor Whitmill. It was about a mark on Helms' face, which Mr Whitmill claimed infringed a copyrighted tattoo he created for boxer Mike Tyson.
"Warner Bros and Mr Whitmill have amicably resolved their dispute. No other information will be provided," Mr Whitmill's attorney Geoff Gerber said.
Apparently the deal was hammered out during an all-day mediation on Friday in St Louis.
 

Zurich reaffirms commitment to providing automatic flood insurance

Following the catastrophic Queensland and Victorian floods, Zurich today reaffirmed its commitment to provide automatic flood insurance to its commercial customers.

In 2008, Zurich was the first Australian insurer to provide automatic flood insurance for the majority of its commercial customers and continues to be the only insurer to do so.

"Despite the impact of the floods much of the country suffered last year and in recent months, Zurich remains committed to giving our customers peace of mind when disaster strikes," said Zurich Australia General Insurance Chief Executive Officer, Mr Shane Doyle.

"There is major confusion with customers and the public at large on the issue of flood cover. Zurich simply believes it is the right thing to do to embed automatically flood cover in our commercial customers' insurance policies."

"There's clarity with Zurich's commercial insurance with 98. 

What is Crisis Response Expenses Insurance?

 As a result of bodily injury to a third party, an insured may suffer adverse general public confidence. The purpose of considering this extended coverage is intended to help regain the confidence of the general public or of a specific market segment.

Some examples include:

 The property owner of a premises experiences adverse attention in the local paper after a visitor accidentally slips and falls which causes severe bodily injury

A manufacturer has a product in the market which has caused the user bodily injury and as a result experiences adverse media attention.

These expenses incurred as a consequence of these or similar incidents may not be covered by your current policy, but Chubb Commercial Insurance Policy is offering this additional cover as a new endorsement.

Dynamiq Risk Alert:

Situation:

There is a high risk of civil violence and political unrest as a result of the 19 upcoming major elections in African nations with the potential for the so-called “Arab Spring” to spread from the Middle East and North Africa. 

  

How far does a duty of care extend for a Taxi Driver?

QBE has been ordered to pay 80% of a $760,000 claim on behalf of their client when Justice Fryberg had to rule on the civil responsibility for the death of Stephen Crouch.  French v QBE Insurance (Australia) Limited [2011] QSC 105  French v QBE Insurance (Australia) Limited [2011] QSC 105   QQ        French v QBE Insurance (Australia) Limited [2011] QSC 105

The Taxi driver was held to have owed Mr Crouch a duty in tort and in contract as ‘carrier’, to have delivered him home safely and in the circumstances that arose, to remain with him at least until the police arrived. This standard of care the driver was required to observe was to be ”responsible for delivering Mr Crouch to a place of safety or to another person who would look after him.” The taxi driver ”ought reasonably to have known that if you failed to deliver Mr Crouch to his home or otherwise to a situation of safety, but left him lying on the footpath, there was a risk that he would wake up, wander onto the carriageway and be hit by a vehicle”. 

Is Public Speaking your biggest Fear?

Not really an Insurance subject but it is connected as us Brokers are often called upon to address Boards of Directors, or internal forums or Insurance related seminars. To do these is a great honour and an opportunity to sell yourself. But gee it is too scary..... What if people think I am stupid...... What if I really stuff myself up?

Latest News

Special offer to CPR Insurance clients

Employsure are providing a FREE Business Health Check to all our clients and gives you the opportunity to receive an analysis of the health and safety requirements in your workplace. Also. Employsure  will review your employment agreements as well as your wage rates helping you to avoid workplace claims.

Ordinarily this would cost you at least $1,250 but because you are a CPR Insurance client, it is free!

It involves the following review for you.

SAFECHECK

A specialist Work Health and Safety Consultant will visit your workplace and carry out:

A review of your business’ current work health and safety policies, procedures and systems to identify areas of concern or non-compliance

Following the review, you will receive a report summarising the findings and the health and safety

Status of your workplace

WAGE CHECK

A Wages Adviser will review your rates of pay and produce a Wage Check report.

The review will be conducted against the industrial instrument applicable

A report will be supplied advising if the wages are compliant and what steps to take to achieve compliance

CONTRACT REVIEW

A Document Consultant will review an employment agreement and provide recommendations.

The review will highlight compliance issues with the Fair Work Act 2009 as well as best practice

The report will make recommendations to achieve compliance and provide protection to your business.

This will remove any areas of potential dispute and risk

So what do you have to lose? Contact us on 07 3123 1137 and arrange 

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D&O premium pool ‘must treble’ to return to profitability

A new report – called "Show Me The Money!" by insurer XL Catlin and law firm Wotton + Kearney – is the second in a series of three white papers on securities class actions and their impact on the Directors & Officers Liability (D&O) market. The main conclusion is that Directors’ and officers’ (D&O) insurance premiums are under-priced significantly and need to rise strongly to restore profitability. The main risk areas are those exposed to securities class actions, 

It says Directors & Officer's Side A, Side B and Side C cover has been chronically underpriced since at least 2011, while the frequency of class actions is increasing as more plaintiff lawyers and litigation funders enter the space.

The analysis suggests last year’s overall premium pool of about $210 million would need to increase by at least three times to establish a profitable market, if it is assumed all other factors stay unchanged.

“Recent market developments would indicate most D&O insurers are now endeavouring to restore some semblance of profitability to their portfolios after years of market losses,” the report says.

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