Thursday, January 17, 2008

Australia has a sophisticated and well developed insurance market.

Types of insurance
Life insurance products sold in Australia include Term life insurance, Disability Income insurance. Australian insurers are unusual in providing a lump sum Total and Permanent Disability insurance. Life insurers also sell superannuation investment products.

Insurance in Australia Life insurance
General insurance products sold in the Australian include:
Each Australian state has its own form of motor vehicle Compulsory Third Party insurance.
Worker's compensation, while strictly speaking is life insurance, has traditionally been provided by general insurance companies. This compulsory type insurance is subject to extensive state based regulation (including premium rating and reinsurance rules).

Casualty insurance such as Motor Vehicle and Public Liability Insurance;
Property insurance such as Home and Contents insurance. General insurance
Due to the Australian Government provided universal health insurance, Medicare, health insurance in Australia is limited to those services not covered by Medicare or to services provided in private hospitals.

Health Insurance
Life Insurers were traditionally mutual companies, but in the 1980s and 1990's many of them demutualised and with a few large exceptions are owned by banks. The large remaining insurers have become "financial services" organisations and now derive the majority of their revenue from superannuation investment products.
General Insurers have a more diverse ownership structure, with more stand alone independent general insurers (although some life insurers do own general insurers).
Health insurers are still predominantly mutuals. The notable exception is Medibank Private largest private health insurer in Australia which is owned by the Australian Government.

Industry structure
see main article Australian insurance law
The prudential aspects of insurance (solvency etc) are regulated by the Australian Prudential Regulatory Authority. Matters relating to advice or disclosure of insurance products sold are regulated by the Australian Securities and Investments Commission.
The primary legislation is:

Life Insurance Act 1995 (Life Insurance)
Insurance Act 1973 (General Insurance)

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