FILE PHOTO: Logo of insurer Axa is seen at the entrance of the company's headquarters in Brussels Thomson Reuters PARIS (Reuters) - BlaBlaCar, whose amateur chauffeurs share costs with passengers on long-distance journeys, and AXA said on Tuesday that they had launched a new car insurance product.
The product, which will be launched initially in France, will offer insurance protection for drivers that use the BlaBlaCar service, with no excess charged for damage that may occur whilst carpooling.
BlaBlaCar, which was founded in Paris in 2006, describes itself as the world's largest carpooling community.
BlaBlaCar is among several new firms challenging traditional carmakers and transport companies alike.
Such companies include the likes of Uber [UBER.UL] and Avis-owned ZipCar, which offer access to self-drive vehicle fleets for as little as an hour at a time.
The home block of vines at Gibbston Valley Winery, Central Otago New Zealand Photo: Gibbston Valley Winery
With no pre-existing medical conditions and aged 65 or under, you can expect to pay about $400 for an annual travel insurance policy with no extras.
That's about three times what the same traveller might pay for a policy with the same level of cover for a two-week trip to Indonesia or New Zealand.
Therefore you might think that any less than three overseas trips per year and annual cover makes no sense, but it's not that simple.
One of the best reasons to buy an annual policy is peace of mind, wherever your travels take you.
If you're making a trip to visit friends in another city or taking a long weekend wine country escape, you wouldn't buy travel insurance for that alone, yet an annual travel insurance policy could cover you for trip cancellation, vehicle excess on a hire car and loss or damage to your possessions.
Not every traveller buys travel insurance if they're cruising in Australian waters, but they should – and again, an annual policy means you're covered.
An overhaul of insurance industry rules has taken a step forward with Commerce Minister Kris Faafoi inviting submissions from the public on what needs to change.
But O'Cromtha, one of a number of Tower policyholders, locked in a court battle to get his earthquake-damaged Christchurch home repaired, said there were some glaring omissions in the areas the discussion paper covered.
"I didn't expect to be sitting in my earthquake-damaged house seven years after the original trigger event," he said. "I still haven't got to the court."
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O'Cromtha fears Faafoi's consultation will be window-dressing unless access to timely justice is addressed.
But he said the Government was conflicted as owner of EQC and Southern Response.
He estimated there were currently around $1 billion of claims in front of the courts, with just two judges handling the majority of the cases.
O'Cromtha also called on the Government to review the legal onus for individual policyholders to prove they have a claim.
People will have until July 13 to have their say on insurers.
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People will have until July 13 to have their say on insurers.
Policyholders finding themselves in a fight with insurers often lacked the resources to do it, forcing them to settle.
"It's ridiculous. We really needed an independent regulator for insurers that has teeth, and can impose sanctions," O'Cromtha said.
Releasing the discussion paper, Faafoi said people's experiences following the Christchurch earthquakes and a Royal Commission in Australia had highlighted "the need to look at whether greater regulation of insurer conduct is required".
In response to O'Cromtha, Faafoi said the consultation was an opportunity for the public to raise their all their concerns.
Faafoi said there were "significant problems" with insurance contract law that were undermining the effectiveness of insurance, and affecting people who did not receive the support they expected from their policies.
It's not just house and car insurance under the spotlight.
"I have heard, for example, that consumers are sometimes not covered for losses or unable to claim for important needs like health treatment because they innocently did not disclose seemingly unrelated matters to the insurer," he said.
"This is really tough for people who genuinely believe they have met their requirements and are later unable to rely on benefits of insurance. Onerous disclosure requirements are one of the issues we need to consider and, I hope, an issue that will be addressed in feedback from submitters."
Spotlight on four areas
There are four core areas of possible reform raised the discussion paper issued by Faafoi on Tuesday.
The first is to bring insurance policies under the Fair Trading Act.
Currently, insurance contracts are carved out of some aspects of the act, meaning they can contain "unfair" contract terms.
The second is to address the unfair disclosure rules, which it is easy for ordinary people to trip over.
People taking out insurance have a duty to tell an insurer everything that would be "material" to a "prudent underwriter".
Anyone who fails to do so, can have their policy torn up, and a claim declined, which is unfair as most people have no idea what a prudent underwriter considers to be material when deciding whether to issue a policy, and what premiums to charge.
Someone who accidentally fails to disclose something, can innocently pay premiums for years, and only find out at claims time that they have paid their money for nothing.
"The duty to interpret what is meant by material in influencing the judgement of a prudent insurer is overly onerous on the consumer," this discussion document says.
It's something the Insurance Ombudsman Karen Stevens has campaigned on for more than a decade.
Questions are also being asked about whether insurers are too lightly regulated.
The IMF, in its last review of New Zealand, said regulation of the conduct of insurers was "inadequate".
The discussion paper also asks for any evidence that insurance intermediaries like banks and insurance advisers are behaving badly, and whether sales incentives like high up-front commissions, which can reach more than 200 per cent of first year's premium, are causing poor outcomes.
Just last week, the Financial Markets Authority revealed that insurance companies had paid $18 million to take insurance advisers on trips overseas in a two-year period, which their clients may not have been aware of.
Insurers are not required to publish figures of the number of claims they turn down, and why.
An investigation by ASIC in Australia found very different claims-paying records from insurers, but no such data has been published in New Zealand.
There may also be competition issues that are resulting in people paying excessive prices for insurance.
Consumers found it hard to compare prices and policies, MBIE said.
Faafoi wants to know what can be done to change this. Overseas, minimum policy conditions are imposed on some kinds of policies, but New Zealand tech companies have struggled to do online comparison engines, as insurers have blocked their efforts by refusing to share their pricing.
The deadline for submissions on the discussion paper is July 13.
Proposals for law change will be with the minister by March next year.
A consumer watchdog has called for New Zealand's regulators to take a closer look at insurance products sold via car dealers in the wake of an Australian review which has forced insurers to pay back millions to customers.
However, the bodies which represent insurers and motor vehicle dealers believe there are no problems here.
Jessica Wilson, head of research at Consumer New Zealand, said people who bought cars were regularly offered insurance and warranty products which may provide very little value.
"You can end-up paying for cover you're already entitled to by law."
While other products, such as payment protection insurance, often came with restrictive terms and conditions, which limited the consumer's ability to make a claim, Wilson said.
You can end-up paying for cover you're already entitled to by law.
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"We're concerned these products continue to be sold with misleading information about the cover they offer and we'd like to see regulators take a closer look at this market."
In 2016 the Australian Securities and Investment Commission released three reports covering its review of the sale of add-on insurance through car dealers, which found that the insurance was expensive, of poor value and provided consumers very little or no benefit.
Since then five insurers have said they would pay back more than A$120 million ($131m) to consumers.
The products include insurance for tyre and rim, warranty, loan protection and guaranteed asset protection.
Greig Epps, industry relationship manager at the Motor Trade Association said those sorts of polices were sold in New Zealand via car dealers but the regulatory environment here might mean the problems found in Australia did not exist here.
"Recent revisions to the Consumer Credit Contracts and Finance Act (CCCFA) and changes brought in under the Responsible Lending Code mean that all finance and insurance selling must meet the customer's requirements," Epps said.
"So selling F&I products in NZ in a way that does not meet that requirement will be 'illegal' or 'non-compliant'.
"In light of this regulatory environment, it may be that the problems found in Australia do not exist here or may be more difficult to manifest here on a wide scale."
Epps said the car dealer was often simply an "intermediary" for the insurance company and consumers also needed to take responsibility.
"MTA advises its vehicle trader members to be as clear as possible about these products, there is also a need for customers to have a good understanding of their own current insurance coverage and determine whether they need any further insurance or warranty products."
Tim Grafton, chief executive of the Insurance Council, said: "ICNZ has not been advised by either regulators or its members of the sale of insurance that is not fit for purpose.
"ICNZ requires that its members do not bring the insurance sector into disrepute."
Suncorp, one of the Australian insurers, who will pay back A$17.2m to customers also offers insurance in New Zealand via Vero.
Its New Zealand spokeswoman said Suncorp did not sell similar products through car dealers in New Zealand.
New Zealand regulators have yet to look into the add-on insurance market.
An FMA spokesman said: "We have not been reviewing the practices around car loan insurance and to date have not received any complaints in this area.
"While all insurance services in New Zealand are subject to the fair dealing rules under the Financial Markets Conduct Act, insurers are not licensed by the FMA, which limits our remit."
The spokesman said its initial focus on insurance had been on sales and incentive practices in relation to life insurance, which has longer term consequences for customers and therefore poses a higher-risk.
"We'll continue to consider how we can use our existing powers in relation to general insurance."
A spokesman for the Commerce Commission said it did not have any current investigations into the matters investigated by ASIC.
AAP Delays accounted for 37% of complaints about the National Disability Insurance Agency.
Delays with the national disability insurance scheme are continuing to drive record numbers of complaints about the reform, new figures show.
The latest report on the NDIS, released on Tuesday, shows 4,146 complaints were made to the National Disability Insurance Agency (NDIA) in the three months to the end of March.
It is the highest number of complaints received in a single quarter, well above the 3,880 complaints received last quarter when numbers were artificially inflated by the manual entry of earlier data. The number of complaints in the two quarters prior was 2,961 and 1,669 respectively.
By far the most common frustration was with timeliness. Delays accounted for 37% of participant complaints about the NDIA, well above previous levels (28%).
Since its inception, 17,352 complaints have been made about the NDIS, the equivalent of roughly one complaint for every 10 participants with approved plans.
“The NDIA is concerned about the level of complaints it has received,” the report said. “The challenges experienced in implementing the scheme are recognised and work is proceeding on the participant and provider pathway review to address the issues that underlie the complaints.”
Related: NDIS mistakenly posts changes restricting access for autistic children
The nature of the complaints is likely to enliven criticism of the government’s staffing cap on the NDIA. Critics say the cap has hampered the agency’s ability to effectively and efficiently implement the scheme.
Earlier this month, a damning ombudsman’s report found people were waiting up to nine months for a review after complaining of errors or inadequacies with their support plan. Some were waiting months for a simple callback from the NDIA, the ombudsman found.
Tuesday’s report also shows alarming gaps affecting those who are already receiving state and territory disability support services. About 2,430 of those already receiving support did not meet NDIS access criteria. Another 13,625 could either not be reached, rejected an opportunity to enter the scheme, or withdrew their request for NDIS support.
Advocacy groups have long warned that such individuals could be left without support, as state and territory governments withdraw services in the expectation they will be replaced by the NDIS.
In a statement the NDIA chief executive, Robert De Luca, said: “The NDIA will continue to proactively work with the states and territory governments to bring eligible people into the NDIS in future quarters.”
More broadly, the report shows about 160,000 people are receiving support through the NDIS, including 151,970 people with approved plans and 10,253 children receiving early intervention services.
About 45,000 had not previously received any government-funded support.
“These figures show that under the NDIS, more and more Australians with disability are receiving better and more effective support and assistance than ever have before,” De Luca said.
Satisfaction with the planning process – when an individual’s support needs are determined and funded – remained steady, with 84% rating it as good or very good.
De Luca said the scheme was having a positive impact. About 90% of parents or carers with young children said the scheme had helped with their child’s development and access to school services. About three-quarters of those aged 25 and over said the NDIS had helped them with daily living activities.
“These strong outcomes demonstrate the NDIS is already delivering on its goals to increase Australians with disability’s independence and participation in the community,” De Luca said.
SYDNEY (Reuters) - Fund managers who perform poorly face being locked out of Australia’s A$2.6 trillion ($1.96 trillion) pension industry if recommendations from the government’s top economic advisory body are implemented.
The Productivity Commission said in a report on Tuesday that a shortlist of up to 10 strong-performing pension products, chosen by an independent panel, should be presented to workers from which to choose when they enter the workforce.
If adopted, the Commission’s model would replace a system whereby the employer chooses a fund for any worker who does not nominate a preference, regardless of the product’s performance, fee structure or insurance arrangements.
“Most (fund) members are in funds that deliver good investment returns, but millions of members are in funds that persistently underperform — over one in four funds,” said Karen Chester, the Commission’s deputy chair.
“Over an average member’s working life, being stuck in a poor performing default fund can leave them with almost 40 per cent less to spend in retirement.”The Commission is also reviewing insurance arrangements within pension products, after it found many Australians were paying for “zombie” policies on which they weren’t eligible to claim, especially if they had multiple pension accounts or were not currently employed.
“The chief and costly culprit for such’zombie policies’ is income protection, which can typically be claimed against only one policy and only when members are working,” the Commission said in its report.
Becoming an employer’s nominated fund, known as a default fund, is big business. Australia boasts the third-largest pool of retirement savings in the world, according to OECD data. “SUPER” FUNDS’ INFLOWS GUARANTEEDThe industry enjoys billions of dollars of guaranteed inflows a year, underpinned by a mandatory system where almost one-tenth of a worker’s wage is deposited into a pension fund, known locally as a superannuation or “super” fund to be accessed at retirement.
About 60 percent of those inflows go to default funds, according to Jeff Bresnahan, chairman at research house SuperRatings, because most workers don’t actively research and choose their own fund.
“There will be some funds that have underperformed for some time and are still getting strong flows,” Bresnahan said.
He noted, however, that the Commission’s proposal might not be workable, given it would be difficult to choose the “best 10” products when performance can be cyclical, and funds must also be measured on their fee structures and life insurance arrangements.
The Productivity Commission will hold public hearings next month before finalizing the recommendations it sends to the government for possible implementation.
Pension assets totaled A$2.6 trillion at the end of the December 2017 quarter, according to the Association of Superannuation Funds of Australia.
Last year, the asset pool grew in size by 10.1 per cent, driven by investment returns and new contributions.
Any move to change the default fund system would likely ignite a new battle between commercial, or retail, funds and the country’s union-backed industry funds.
Industry funds have historically dominated the default market, locking in agreements with some of Australia’s biggest sectors, including manufacturing and education.
Commercial funds, run by the major banks and wealth managers, have lobbied the center-right federal government for employers to be allowed to directly negotiate default arrangements.
Reporting by Jonathan Barrett in Sydney; Editing by Eric Meijer
The number of people in Alberta receiving regular employment insurance benefits declined by more than 26 per cent over the previous year as of March, according to data released Thursday by Statistics Canada.
About 60,100 Albertans received employment insurance benefits in March. Compared to the same period a year earlier, Alberta recorded the fastest year-over-year decline in the number of beneficiaries among all provinces.
That figure was also down 2.4 per cent, or 1,500 recipients, compared to one month earlier in February.
The trend corresponds with changes in the unemployment rate in the province throughout the past year.
Calgary’s unemployment rate was at eight per cent as of April, about 1.5 percentage points higher than the provincial figure. The unemployment rate in Calgary was at 9.2 per cent in April 2017.
Alberta recorded real GDP growth of 4.9 per cent in 2017, following declines of 3.9 per cent in 2015 and 3.6 per cent in 2016, according to Statistics Canada.
A similar decline in employment insurance claims was observed nationally. More than 470,000 Canadians received benefits in March, which was down 14 per cent, or close to 77,000 fewer beneficiaries, from 12 months earlier.
Canada experienced a 1.5 per cent decline in claims from February to March of this year, with 7,300 fewer employment insurance beneficiaries.
