Privatised ACC: fully-funded or not?
Reported comments from the chief executive of the Insurance Council have raised serious concerns about the funding practices of companies that have entered the newly privatised workplace injury market, Labour ACC spokesperson Ruth Dyson said today.
"In today's Independent newspaper, Insurance Council CEO Chris Ryan has expressed his concern that Labour's policy would leave private insurance companies "with a 30 year tail of long-term injuries to deal with and with no premiums to fund the cost of compensation."
"It is a remarkable statement. Up until now it has been claimed the new regime is a fully-funded scheme. That is, insurance companies are supposed to be collecting enough in premiums to cover payments in the current year AND all future ones.
"It now appears that is not the case. According to Mr Ryan, insurance companies are building up an unfunded liability. Ironically, the Insurance Council and the Employers Federation savagely criticised the ACC over its unfunded liability and promised a far rosier future under privatisation.
"While the Government continues to talk up its ACC 'reforms', there is more and more evidence that the whole process has been an ill-thought out, ideologically driven disaster," Ruth Dyson said.