Page 4149 - Week 13 - Thursday, 6 December 2007
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(2) ACTIA underwrites all of ACT Health’s claims up to certain limits, and reinsures above those limits with national and international reinsurers. These reinsurers vary over time depending on the availability of cover in the world market. For the current year, the principal reinsurers are Marketform (London), Swiss re , Hannover Re, Munich Re, Newline (London) and Chaucer (London).
Payments to ACT Health from ACTIA and the reinsurers will gradually increase as the insurance portfolio matures. To date this increase is slower than the actuaries have assumed.
(1) The increase in premiums for Health from 2006-07 to 2007-08 for medical malpractice was only $0.553m.
(2) The main areas of the Budget affected by medical indemnity payments are expenditure and revenue items in the accounts of ACT Health and the ACT Insurance Authority, and would relate to the payment of insurance premiums, payments on claims and reinsurance premiums and reimbursements.
Insurance—risk management
(Question No 1757)
Mrs Burke asked the Minister for Health, upon notice, on 13 November 2007:
(1) In relation to the increasing costs of medical indemnity insurance, and further to the response to question on notice No 1714 and the annual report for ACT Health revealing that ACT Health is currently defending 462 actions, on what basis does ACT Health base its projections for future indemnity insurance;
(2) How will the rising cost be factored into the ACT Health budget;
(3) Will any functions currently undertaken by ACT Health be reduced or cancelled as a result of these rising costs;
(4) Is the Australian Capital Territory Insurance Authority the sole provider of indemnity insurance to ACT Health; if not, who are the other providers and how much insurance does each provide; if so, for how long has the Authority taken responsibility for this insurance and what does it base its assessment of these liabilities on.
Ms Gallagher: The answer to the member’s question is as follows:
(1) ACT Health relies on guidance from the ACT Insurance Authority for the cost of insurance.
(2) In the event that insurance costs are increased by the ACT Insurance Authority, then the impact is considered in the annual budget process.
(3) You refer to a “rising cost” that I am not aware of at this point in time. Usually ACT Health is advised of higher costs in time for budget consideration and it is not standard practice to reduce services to meet such costs.
(4) Yes, the Australian Capital Territory Insurance Authority is the sole provider of indemnity insurance to ACT Health. It has had responsibility for this insurance since
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