What can be done about public liability insurance premiums

In the short term, some community events and activities might be able to proceed if subsidies were given. But in the long term, the whole community may end up paying for higher premiums for years.

This would simply result in growing profits for the insurance industry. More worryingly, subsidies might remove a valuable incentive for organisations to minimise the risks of injury to the public.

We acknowledge that along with the Commonwealth Government and the insurance industry, the State Government has a role to play. We have been fulfilling our responsibilities. For example, my Government provided a $600 million rescue package following the collapse of HIH. The package covers claims against HIH – both compulsory third party motor vehicle and home building warranty. We also called on the Prime Minister to set up the HIH Royal Commission and we are represented before the Commission. We introduced health care liability reforms in response to an increase in litigation and sky-rocketing insurance costs.

The Government will also shortly introduce legislation to exclude terrorist acts from compulsory third-party motor vehicle policies. This will ensure the CTP scheme can continue, despite international reinsurers refusing to cover terrorist acts as a result of September 11.

One of the many factors leading to rising costs is the increase in personal injury claims and the size of compensation awarded. This trend has been driven by an increasing litigiousness in our society. Australia is adopting a culture of blame, even where the damage suffered might be minor and temporary.

Elements in the legal profession have encouraged a view that someone else must always pay, that litigation is the way to resolve disputes. All it does is increase costs for insurance customers and the wider community.

The Government is introducing restrictions on lawyers’ advertising for personal injury matters, to take effect from April 1. The new rules will stop lawyers advertising personal injury services on television, on radio and in hospitals. For example, patients and visitors will no longer see advertisements for lawyers in hospital lifts.

The new rules will also restrict the kinds of statements that lawyers can make about personal injury work in printed advertisements or advertisements on the internet.

The rules will prevent lawyers engaging in "ambulance chasing" advertising. This advertising encourages people to claim for every little slip and fall, regardless of the real merits of the case or their genuine need for compensation.

The new rules will counteract the litigious approach of some members of the legal profession.

On the broader question of public liability insurance, the Government is holding discussions with the Insurance Council of Australia, the New South Wales Council of Social Services, arts and sporting organisations, small business and tourism operators, and local government representatives.

The Government is helping organisations help themselves. Next month, for example, the Minister for Sport and Recreation will launch a detailed risk management guide for sporting and recreational bodies in NSW. I understand New South Wales arts and cultural organisations are starting to consider the issue of risk management for the types of activities they undertake. We will ensure the new sporting risk management resource is available to bodies in the arts and community services fields which may also find it useful.