What brokers should know: WA’s workers comp changes
What brokers should know: WA’s workers comp changes | Insurance Business Australia
Insurance News
What brokers should know: WA’s workers comp changes
Zurich head lifts the lid
Insurance News
By
Daniel Wood
Western Australia is days away from significant changes to the state’s workers’ compensation laws.
The state government has called the Workers’ compensation and Injury Management Bill 2023, “A complete rewrite” of the legislation and “the culmination of an extensive review and consultation process.”
The Act comes into force from July 1.
Angela Bertoncin (pictured above), Zurich’s head of workers’ compensation, highlighted four of the more important changes that impact employers and brokers.
Four Workers Comp changes brokers need to know
1. Brokers become recognised service providers
“Firstly, brokers will now be recognised as a service provider and, from July 1, 2024, will be subject to oversight and regulation as per WorkCover WA’s expectations around new Insurance Broker Principles and Standards,” she said.
Bertoncin said this will involve additional monitoring of obligations, documentation and communication to ensure clarity and compliance.
2. New wordings and documents
“Secondly, there will be new wording, forms and documents, as well as new guidelines and language to understand,” she said.
Bertoncin said one key legislative change is the embedding of policy wordings into the Act’s regulations rather than having them separate.
Another key shift, she said, is the removal of reasonable precautions conditions.
The new Act’s regulations specify when an insurer can refuse to indemnify due to the employer’s failure to take reasonable precautions. This creates a need for more complete information gathering to provide to the insurer at a policy inception or renewal.
Bertoncin said the new policy wording will also refer to exclusions specified in the new Act, including terrorism, war events and claims made from outside Australia.
3. Streamlined appeals and increased benefits
“Thirdly, there will be a more streamlined appeals process for premium loadings and industry classification,” she said.
Insurers, said Bertoncin, will also have increased obligations to help injured workers by accepting liability faster with the introduction of Provisional Payments and Deemed Acceptance.
They will also be providing increased benefits.
These include, she said, increased weekly benefits (such as an increased cap on medical and health expenses and extension to the point at which a worker’s income compensation payments step down) and faster liability decisions, payment of income compensation and medical expenses.
Injury management and return to work processes, said Bertoncin, are also more streamlined.
4. New pool for catastrophically injured workers
“Finally,” she said. “There will be an introduction of a new pool for catastrophically injured workers with lifetime care and support under the catastrophic injuries support scheme.”
How can brokers prepare?
Bertoncin encouraged brokers and employers to educate themselves about the changes by accessing resources on the WorkCover WA website.
She said insurers are also playing a “crucial role” guiding brokers and employers through the changes.
Education, compliance and claims cost challenges
Zurich’s head of workers’ compensation anticipates several challenges. These include implementing the new rules and ensuring that employers and brokers are aware of the changes and their implications.
She said the new Act brings in “quite substantial” increases in fines and penalties.
Another consideration, she said, is the potential impact on claims costs.
“Claims costs may be impacted particularly in the areas where there are increased benefits, such as weekly benefits and medical costs,” said Bertoncin. “Legal costs may also increase as parts of the new legislation are challenged.”
A positive impact on workers’ compensation
Despite initial challenges, Bertoncin said the new legislation is expected to have a positive impact on WA’s workers’ compensation insurance market.
One way it will do this, she said, is by increasing professional training and ensuring employer policies are in place to avoid underinsurance.
“Injured workers will also have claims liability provided more quickly and have access to provisional payments, including higher benefits in some instances,” said Bertoncin.
She also said the changes could lead to improved collaboration.
“We see the new legislation as an opportunity for insurers and brokers to work more closely together to help each other in protecting customers and ensuring they are fully aware of the new obligations,” said Bertoncin.
Are you an insurance professional involved in WA’s workers’ compensation sector? Please tell us how you see the upcoming legislative changes below.
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