Why do governments bury their heads in the sand?

I originally set this blog up to address insurance questions but more and more I seem to be questioning the attitude and lack of leadership of governments on a wide range of issues.

The fact is that as the insurance industry is there to pick up the financial effects of loss, injury and disruption, then what governments do and do not do effects insurance and those that purchase the protection.

The latest issue that has me shaking my head is the decision of the Tasmanian and Northern Territorial governments allowing water treatment departments and/or companies not to participate in the collection of wastewater samples.

Why is this important? The samples taken provide information on drug use. Drug use effects our economy and those that live in this country in a wide range of ways from increased car accidents, burglary and other similar crime rates, work place injuries etc.

While the Program is intended to provide a national picture of drug use, regrettably, during the period covered by the latest report the operators of wastewater facilities in Tasmania and the Northern Territory declined to participate in the collection of wastewater samples.

Who are they kidding by burying their head in the sand. You cannot improve something that you do not measure. It really is a disgrace.

What we do know, from the latest report, is that Perth has finally shaken its tag of Australia’s methamphetamine capital, with a report showing that Adelaide residents are now bigger consumers of the drug.

The Australian Criminal Intelligence Commission (“ACIC”)’s findings were based on tests in October and December’16, and February’17 at wastewater treatment plants, which showed Perth residents consumed about 40 doses of the drug for every 1000 people each day, just above the capital city average of 37 doses a day.

Adelaide recorded about 60 doses a day — or more than 1½ times the national average. The Perth figure had almost halved since October last year when the consumption rate peaked at almost 80 doses a day, the highest for any capital city.

The ACIC’s report showed that meth remained the most widely abused illicit drug in the country, but use had been falling.

As the ACIC stated about Tasmania and Northern Territories decision to opt out of the wastewater sample collections: “This is disappointing as it limits our understanding of trends and emerging issues in those jurisdictions and the ability to compare current findings with those published in the first report.

On top of our appalling investment in risk mitigation, the withdrawal of funds to the national anti-theft task force by Victoria and the ongoing stuff up by NSW on Emergency Services Funding, we clearly need a change of direction at all levels of government for the good of society and our economy.

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Blog reader question: Theft of goods on consignment

I received a question from a blog reader as follows:

I have had a crystal stolen from my shop which was on consignment. My insurance is refusing to pay out as buried in the small print it states that shoplifting is not covered (the theft was when the shop was open & trading). The crystal was on consignment. Can you advise who is responsible for the insurance on this item, me or the owner. The theft was a team including distraction group, & we only have one staff on at a time, so could not have been prevented by us doing anything differently. It was too big to be under lock & key.

Thank you
Angi [Surname and email provided]

My response to Angi read:

Hi Angi,

Sorry to hear of the theft. We need to bring back stocks and or public floggings. I think all of us are appalled at the rising crime rates and the slap across the wrist with a wet tram ticket if they do get caught.

When you say on consignment, I assume you mean, the everyday meaning that being you hold the item on trust until it is sold, it would depend on the terms of the consignment. If it had just been delivered and you are referring to a consignment note, then this is something different.

If there is no terms and condition in the consignment agreement, then in the first instance, I am sorry to say, you would be regarded as a bailee and as such you would be responsible unless you can show that you have exercised reasonable care.

I think this is going to be a challenge on the information you have advised.

If you would like me to read the consignment agreement and give you more specific advice I am happy to do so. My email is allan.manning@lmigroup.com. There would be no cost for this service.

Sorry again to hear of the loss and the situation you find yourself in. It is probably worth installing a CCTV system if you can to offer yourself some protection or at least as a deterrent.

 

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Whinge or fix it: that is the question!

I wrote at the time how disappointed I was that the Federal Government only earmarked a token $26.1 million towards disaster mitigation for the Federal Budget in 2017-2018.  (To get the benefit the states have to match this dollar for dollar).

At the same time Federal and State politicians are complaining about the high cost of insurance.

Rather than genuinely address the problem, the insurance industry is again being demonised with the Federal Government announcing in the same budget that $7.9 million will be spent over 4 years to enable the Australian Competition and Consumer Commission (ACCC) to monitor and report on prices, costs and profits in the northern Australia insurance market. This is despite the fact the Auditor General’s reported stating that insurance in Northern Australia has been historically under priced. I would argue that this $7.9 million would be better spent in disaster mitigation albeit a drop in the bucket of what is really needed to protect our communities and economy, not to mention individual households and businesses. 

Parking one of the major issues, that being the high level of government taxation on insurance for a moment. But before I do, I did hear that President Trump is planning a trip to New South Wales. His logic is that it is the only state in the world where the leader is more incompetent than he is proving to be. At least he could get the Emergency Service Levy right! – This of course could all be “fake” news.

Anyway, moving on, let us compare Australia’s spend with say what Canada invests in their Disaster Mitigation and Adaptation Fund.

While we plan on spending $26.1 million they plan on spending $2,000 million. That is Canada is spending 76.63 times as much! As a graph, it looks like this!

Yes they are marginally bigger in land mass:

and yes they have about 1/2 as many people again

 

Joseph de Maistre wrote: Every nation gets the government it deserves.  I disagree. Australia deserves better!

Perhaps we could reinstate 457 visas specifically for Canadian politicians to come and show us how to run a government.

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Blocked sewage pipes – the curse of the baby wipes

Here as some wipes that clogged pipework and caused an overflow situation. You can see there is no sign of them breaking down.

Just one of the many brands of baby wipes on the market that may cause a problem if not disposed of correctly.

LMI Claims have seen a number of water damage claims arise due to blocked pipes. While tree roots used to be the most common cause, the cause now is often baby wipes.

Most are not biodegradable and therefore not suitable for flushing down the toilet.

We have even seen the ones that claim to be flush-able causing problems.

With an overflow from sewage it is not a simple mop up and move on, especially if carpets or other soft furnishings are involved.

Following the old adage that prevention is better than cure, I hope this short post stops this from occurring at your home or place of work.

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Product Safety Recalls Australia – 24 July 2017

The latest recalls from Product Safety Australia includes the following:

Honda Australia Pty Ltd — Honda Accord

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Mercedes-Benz Australia/Pacific Pty Ltd — Actros Truck

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Skoda Australia — MY17 Skoda Yeti and Rapid

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Audi Australia Pty Ltd — Audi Q3 (8U)

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Assassin Dirt Bikes — Assassin Scorpion Mini Bike

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The need for continued learning

One of the great things about general insurance claims is that it covers such a wide diversity of issues, industries and of course people. Whenever I can, I attend seminars or conferences alike that will add to my professional knowledge.

Last night, I attended an excellent one run by The International Association of Arson Investigators at the Police Forensics Laboratory in Macleod in Melbourne. For the very modest cost of $20, we were provided the choice of a hot meal, followed by coffee. The reason I raise this is that the cost should not be an issue.

What was the key reason for attending was 4 excellent speakers from the Victorian Institute of Forensic Medicine. While there were well over 100 attendees, I was personally disappointed that there were no loss adjusters present where as 20 years ago there would have been 10-15.

Good claims adjusters cannot be arm chair detectives, and while they should never pretend to be something they are not, they should be satisfying themselves that the reports they receive are credible and is in keeping with their own observations.

It has been quite a week for me in reflection as to how we can do things better as an industry, which again flows from the Mansfield Awards last week and the work we have been doing on ClaimsComparison.com.

One of the issues I had to confront was whether or not my membership of the Australasian Institute of Chartered Loss Adjusters was value for money, and when I considered the cost vs the benefit, it was overwhelmingly apparent that my subscription was better spent elsewhere. This again, was extremely disappointing for me as I was the deputy president of the Australasian division of the Chartered Institute of Loss Adjusters and along with the then committee worked extremely hard to merge three separate loss adjusting associations. Instead of it raising the standard of the profession, it appears to me we have slid down below the lowest common denominator.

I will retain my membership of the Chartered Institute of Loss Adjusters out of the United Kingdom, the International Institute of Claims Preparers and work with The Financial Services School to develop a comprehensive course for claims professionals.

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Latest claims rating now available

As an addendum to the Mansfield Awards which were presented last week in Sydney (see here for article), I am pleased to advise that the latest claims ratings as determined by complaint data recorded by the Financial Ombudsmen Service, where appropriate, and insured feedback and our regular survey are now available at www.ClaimsComparison.com.

As always, I encourage people to consider the claims service when purchasing insurance and not relying on price alone.

Policy coverage and claims service and financial strength rating are all VERY important criteria when choosing the insurance program that is protecting your assets or those of your client. 

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Mansfield Awards kick off in Sydney

Last night I was extremely pleased to witness the great response that The Mansfield Awards received from all those who attended.

The night started with a video of an insured who went through a major fire and was so appreciative of the support he received from the insurance industry to allow him to put his “baby” and life back together.

This was followed by the evening’s MC, Martin McAvenna who really nailed the reason behind the awards which were to recognise the often unsung heroes of the insurance industry, the claims teams, and to start pushing the need to move the focus away from the price of insurance to quality products backed by good claims service.

Mark Doepel, partner at Sparke Helmore and Chairman of Lloyd’s Australia kept up the very high standard with an excellent presentation on Lord Mansfield and why it is so fitting that the awards were named after the Chief Justice who enshrined Good Faith as an underlying principle in insurance back in 1766.

The first awards were presented by Mr Vivek Bhatia who was representing the first of our two major sponsors, iCare, who announced the winner of the SME category, with the winner Chubb Insurance and the Specialty category with NTI taking the award.

Martin then introduced a short video on the Amal Mulia Orphanage where all funds raised from the evening will be donated to. Both insurance news and LMI Group donated all their time to this important cause and therefore all monies by way of sponsorship and ticket sales over and above the cost of physically running the event will go to this very worthwhile charity.

Our second sponsor for the event was Steadfast, who was represented by Samantha Hollman to present the awards for Corporate Property & Casualty with the winner Berkshire Hathaway Specialty Insurance and Personal Lines category, Allianz Australia Limited.

I then had the opportunity to speak and I stressed the need to continue to invest in our claims teams and their service providers, such as loss adjusters, investigators and the like, and that the evaluation of these services purely on price is equally as silly as buying insurance on price alone. One of the big issues facing the industry is training and recruitment and the government with their changes to the 457 Visa is putting enormous stress on the loss adjusting fraternity in particular, with 34 adjusters in Australia operating on a 457 visa with another 14 in negotiations.

But, the night was more about the positives and I congratulated all winners and finalists, all of whom deserve to be on the finals list, before Terry thanked everyone involved in putting it together, in particular, Madison Seymour from Insurance News, Ashleigh White and Andrew Pitts from LMI Group, our MC, Martin McAvenna and keynote speaker, Mark Doepel.

Then the final pleasing duty was to announce the overall winner of The Gold Mansfield Award for the best claims team in Australia, as Chubb Insurance Australia. Just jumping above finalists Insurance Australia Limited and Vero.

Speaking to people after the event, it is clear that they were so pleased to see so many senior executives from the industry to attend and support their part of the insurance industry and their strong support for this to become an annual calendar event which both Insurance News and LMI Group are committed to.

Today, ClaimsComparison will be updated to reflect all the survey results in 20 classes of insurance, to learn more please visit: www.claimscomparison.com

 

The categories and their nominees and winners (highlighted gold) were:

Personal Lines

Allianz

Ansvar

Chubb

Defence Service Homes

 

Specialty

GT Global

NTI

Terri Scheer

 

SME

Ansvar

Capricorn Mutual

Chubb

Insurance Australia Limited via their brands NRMA, RACQ, RACV, SGIC

 

Corporate

Berkshire Hathaway Specialty Insurance

FM Global

TIO/Allianz

Vero

 

The Gold Mansfield

Chubb

Insurance Australia Limited

Vero

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Nationwide recall sparked by asbestos-laden parts in off-road vehicles

A recent recall notice put out by Product Safety Australia has alerted to at least 18 models of popular Polaris motorbikes and off-roaders that contain asbestos parts. The recall means those who have these bikes can continue to ride them as normal, however concerns are raised when it comes to servicing and maintaining of the bikes and the exposure to these asbestos parts. The asbestos was identified by testing in the US which identified the product in brake pads, brake shoes, gaskets and washers in some models.

This is not the only recall of asbestos parts in vehicles, in 2015, the ACCC issued a recall on asbestos-laden counterfeit brake pads designed to fit Toyota Hilux utes and Hiace vans as well as in 2012, almost 25,000 Great Wall and Chery Chinese cars were recalled by Ateco Automotive when asbestos was found in the engine and exhaust gaskets.

More information about the bike recall can be found on the Australian Product Safety recall website.

 

Other product safety recalls this week includes:

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