Xenophon Looks To Simplify Home & Car Insurance
One of former PM Tony Abbott’s greatest achievements for consumers was in setting up the website privatehealth.gov.au. Unlike any other comparison website, it contains information about all the products of all the private health funds (and there are over 30). If you are prepared to do your research, you are likely to save a bundle.
There is a similar government website for energy plans. And finally, Federal Parliament will look into setting up a similar, government-run home and car insurance comparison service to increase competition and transparency in these $28 billion-a-year markets.
News Corp papers reported this week that currently no privately run general insurance comparison service looks at more than a quarter of the market because the dominant players don’t share their pricing data. This makes it much harder to shop around in an industry that reaps $9 billion a year from consumers for home cover and $19 billion for car protection.
This week Independent senator Nick Xenophon asked the Senate Economics Committee to set up a government-run general insurance comparator following a report that reveals the cost of some forms of cover is soaring at four times inflation.
California runs an independent comparison service for general insurance, as does Norway. The Californian comparison service runs on data insurers are forced by law to provide. The Norwegians just asked for the information and it was handed over.
The government already runs one for home insurance in North Queensland only. It was established by the Coalition last year after cyclone-repaid bills led to a surge in the cost of protection above the Tropic of Capricorn.
The World Bank has studied public-sector comparators and found their set-up costs range from $340,000 to $2.3 million.
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