THE Financial Rights Legal Centre has urged the Australian Government to immediately act to implement the recommendations of the Northern Australia insurance inquiry to ensure Australians have access to affordable insurance and a fair claims outcomes in the aftermath of natural disasters.

The Financial Rights Legal Centre is supporting the recommendations of the Australian Competition and Consumer Commission’s (ACCC) final report on the Northern Australia insurance inquiry including:

• Making it easier to search for, and compare, insurance products;
• The introduction of an effective standard cover regime with standard definitions;
• Requiring that insurers estimate an updated sum insured for their home insurance customers on renewal notices;
• Requiring insurers to warn customers when they appear to be underinsured;
• Banning conflicted commission payments to insurance brokers;
• Help for customers experiencing premium payment difficulties;
• The abolition of stamp duty on home and contents insurance products or the redirection of revenue towards measures to improve affordability for low income consumers or to fund mitigation works; and
• A call for governments to provide direct subsidies to people to relieve acute affordability and cost of living pressures facing people in high risk areas.

Financial Rights Legal Centre director of Casework Alexandra Kelly said Financial Rights assisted more than 120 Australians who were affected by the Black Summer bushfires in 2019-20.

“Many of these people have suffered severe financial hardship and unfair insurance outcomes after losing their homes and livelihoods,” Ms Kelly said.

“We continue to receive calls from people confronting bushfire insurance disputes. People like the residents of Conjola who are struggling to rebuild even a year on from NSW bushfires.”

Financial Rights has also assisted more than 375 Australians affected by other natural disasters like storms, hail events, flooding and drought in the past 12 months.

Ms Kelly said many people confronted similar problems including exposure to significant losses above and beyond their level of insurance.

“This leads to ongoing insurance claims disputes over whether an excess should be paid, the scope of works and cash settlement offers, underinsurance borne of an incorrect sum insured for their property and temporary accommodation,” Ms Kelly said.

The ACCC’s report follows several royal commissions and inquiries concerning natural disasters, the recommendations of which have not been implemented or only in part.

Ms Kelly said the Australian Government must act quickly to implement the ACCC’s recommendations.

“The Australian Government must intervene to ensure that insurance for Australians at risk of experiencing bushfires or other natural hazards is affordable,” Ms Kelly said.

“We support the ACCC’s conclusion that direct subsidies have the greatest potential to work in a targeted way to relieve some of the acute affordability and cost of living pressures facing consumers in higher risk areas.”

About Financial Rights

The Financial Rights Legal Centre is a community legal centre that specialises in helping consumers understand and enforce their financial rights with consumer financial products and services, especially low income and otherwise marginalised or vulnerable consumers.It provides free and independent financial counselling, legal advice and representation to individuals through the following channels: 

• Financial Rights Legal Centre - https://financialrights.org.au/;
• Insurance Law Service 1300 663 464 – a national service focusing on problems with insurance or debts to insurers;
• Mob Strong Debt Help 1800 808 488 – a national service for Aboriginal and Torres Strait Islander callers https://financialrights.org.au/mob-strong-debt-help/;
• Credit and Debt Legal advice line 1800 844 949 for those needing legal advice in NSW;
• National Debt Helpline 1800 007 007 – for people needing to talk to a financial counsellor (this line is answered by a number of different services around Australia, Financial Rights is one of those services).

ends

EFTPOS has announced an updated digital product and technology strategy for rollout over the next two years, which aims to change the daily lives of Australians for the better.

The strategy also provides greater clarity to members, Australian fintechs and retailers about opportunities for innovation and collaboration.

Eftpos CEO Stephen Benton said the strategy aimed to create greater value, ease and security for consumers and businesses by enabling compelling innovations for members, fintechs and retailers that enhance the digital commerce experience.

Mr Benton said much of the work was already well underway and the business was deeply engaged with members and industry participants to finalise detailed rollout schedules over the next two years.

The digital strategy has five key elements: Mobile wallets, e-commerce, digital identity, APIs and fintech access, and a national QR code payments rollout.

“The eftpos digital product strategy has been devised with an Australian focus, creating world-class innovations to compete against global players,” Mr Benton said. "The strategy we embarked on two years ago aimed to transition eftpos from a card present retail business to a major player in the centre of Australian e-commerce that leverages our world-class technology investments.

“It has been a journey not without challenges, but it has come together better than we could ever have hoped, with a keystone being the recent acquisition of Beem It," he said.

“In many ways, eftpos was Australia’s first fintech and our digital strategy builds on that history to deliver on eftpos’ purpose - to do good for Australia. We aim to do this by engaging with members, Fintechs and retailers to make everyday payments easy, secure, smart and cost efficient.” 

Mr Benton said the growth of debit card transactions in Australia made eftpos’s digital strategy even more important for competition and innovation.

He said debit cards were where competition was thriving in Australia today. Debit cards are by far the most popular payment choice for Australians as they move from cash and credit during this challenging time. Of the almost one billion electronic transactions per month in Australia, around 70 percent are now on debit and that number is growing every month. 

Many of the digital initiatives leverage eftpos’s centralised payments infrastructure, the eftpos Hub, that was built in late 2014 and itsToken Service Provider that went live in 2016.

Together, Mr Benton said, these assets provide locally-based, world-class, secure and accessible real time payments infrastructure. The resilient Hub infrastructure has been running at zero downtime since launch and enables local fintechs and financial institutions to access, innovate and compete on top of the eftpos payment rails.  

"The rapid pace of our transformation agenda means new initiatives are being introduced swiftly to encourage competition and innovation during the nation’s economic recovery, and at a low cost due to its accessible design and our use of global standards that facilitate choice."

About eftpos 

Eftpos is Australia’s debit card system, accounting more than 2 billion CHQ and SAV transactions in 2019 worth around $130 billion. www.eftposaustralia.com.au 

ends

THE Australian Small Business and Family Enterprise Ombudsman (ASBFEO) Kate Carnell is encouraging dairy farmers in dispute to contact her office, following the release of an ACCC report reflecting on compliance with the Dairy Code of Conduct.

The ACCC’s Dairy Code: initial observations on compliance report identifies areas of concern including processors’ failure to publish standard form milk supply agreements on time, as well as failing to report on the number and nature of disputes.

Ms Carnell said the issues raised by the regulator, highlight the need for dairy industry participants to understand their rights and obligations under the code. She reiterated that her office was ready to provide assistance with disputes that arise under the code.

“The mandatory Dairy Code of Conduct gives Australian dairy farmers a framework to negotiate a fair price for their product,” Ms Carnell said.

“The code applies to all milk supply agreements entered into, or amended, on or after January 1, 2020. My office can provide small and family business owners in the dairy industry with information on the code, as well as options to resolve disputes and access to mediation and arbitration services.

“The Dairy Code of Conduct provides dairy farmers and other industry participants with avenues for dispute resolution within a fairer framework.”

“In addition to the Dairy Code, my office can provide broader assistance to small and family businesses that also include disputes under the Franchising, Horticulture and Oil Codes of Conduct.”

More information is available about ASBFEO’s dispute resolution services at asbfeo.gov.au

ends

THE INSURANCE INQUIRY report released by the Australian Small Business and Family Enterprise Ombudsman (ASBFEO) has been welcomed by the Institute of Public Accountants (IPA), noting "there is still much to be done".

“The ASBFEO insurance report highlights the many issues facing small business owners, some of which make it impossible for them to carry on business as they can’t get insurance or the cost of insurance is prohibitive,” IPA chief executive officer, Andrew Conway said.

“Whilst this is evidence of market failure, the industry in its entirety should not be brandished with the same brush. The key factor, however, is one of affordability for the most suitable insurance product that meets and aligns with the small business owner’s needs.

“IPA shares the view that the hidden costs of insurance should be made transparent, including stamp duty and GST, which in some states make up 21 percent of the premium," Mr Conway said.

“This is in effect, revenue raising by governments who continue to place undue duress on the insurance system, which adds to increasing costs for consumers.

“The IPA will continue to advocate to properly educate small businesses on insurance needs and importantly, to educate and activate the insurance sector to better understand and meet the insurance needs of small business in a competitive market,” Mr Conway said,

About the Institute of Public Accountants

The IPA, formed in 1923, is one of Australia’s three legally recognised professional accounting bodies. With the acquisition of the Institute of Financial Accountants in the UK, the IPA Group was formed, with more than 40,000 members and students in over 80 countries. The IPA Group is the largest SME focused accountancy organisation in the world.  www.publicaccountants.org.au

ends

ends