Insurance Council of Australia

Motor Vehicle

Motor Vehicle Insurance and Repair Industry Code of Conduct consultation period extended

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Motor Vehicle Insurance and Repair Industry Code of Conduct consultation period extended

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News release

Tuesday, 15 April 2025

In response to industry and stakeholder feedback, the Motor Vehicle Insurance and Repair Industry Code of Conduct Administration Committee has announced that public consultation on the Code of Conduct will be extended for a further eight weeks to 23 June 2025.

The draft Code and supporting documents can be found on the consultation website at www.mviricode.com.au. Public submissions can be made on the website or by email to [email protected].

Stakeholders can also make confidential submissions directly to the Motor Trades Association of Australia by email to [email protected] or to the Insurance Council of
Australia by email to [email protected].

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Insurance industry releases motor insurance roadmap

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Insurance industry releases motor insurance roadmap

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News release

Sunday, 23 March 2025

The Insurance Council of Australia (ICA) has today released a new report calling for urgent and coordinated action to help address the systemic cost drivers behind rising motor premiums.

The Motor Insurance Policy Paper – A Roadmap for Reducing Rising Premiums shows that while comprehensive motor insurance premiums are up 42 percent since 2019 (reaching an average of $1,052 per year in 2024), this is because input costs have soared.

Rising expenses across the sector include:

  • Claims costs. The average claims cost has risen 42 per cent between 2019–2024, tracking the increase in premiums. Claims increases reflect higher expenses for vehicle replacement, parts, and labour, as well as the growing complexity and penetration of vehicle technology.
  • Repair costs. Industry data shows repair costs have climbed 26 per cent since 2022, owing to rising wages, more expensive spare parts, and longer repair times. Repair bills now make up roughly 60 per cent of claim costs, having a major impact on premiums.
  • Vehicle replacement. Replacing written-off vehicles is pricier than ever. New car prices are up as much as 39 per cent since 2019 and used car values are about 32 per cent higher, directly feeding into claim payouts for write-offs which comprise around a quarter of all claims costs.
  • Rental car costs. The cost for insurers to provide rental cars has increased 70 per cent since 2019. Extended repair wait times mean insurers are paying for rental vehicles longer, and the growth of credit hire firms has further unnecessarily inflated rental charges.
  • Rising fraud and legal expenses. Motor insurance fraud, such as staged accidents and misrepresentations of damage, raise operating expenses for insurers. In 2023, fraud cost the industry $560 million.
  • Higher volume of credit hire claims. Credit hire companies provide replacement vehicles to not-at-fault drivers, then recover costs from the at-fault driver’s insurer – often at higher rates than typical rentals. Claims involving these providers have quadrupled since 2019 and are, on average, three times more expensive than standard claims, driving up costs and premiums for everyone.

Despite claims costs rising the same amount as insurance premiums since 2019, data from APRA indicates declining underwriting profit for motor insurance lines.

Insurers’ motor insurance costs as a proportion of premiums collected have increased from 89 per cent in June 2019 to 94 per cent in June 2024, showing a decline in profitability of this product as premiums have risen.

To tackle the root causes of rising claims costs and deliver relief to consumers, the insurance industry is advocating for coordinated action by state, territory, and Federal governments.

Key reforms being advocated for include:

  • Addressing labour shortages. Nearly one in two vacancies in motor trades businesses rely on overseas workers due to chronic skills shortages, however hiring them is challenging due to red tape. Significant training investment is also needed with only 58 per cent of apprentices completing their qualifications.
  • Strengthen motor industry supply chains. The Motor Vehicle Information Scheme (MVIS), which requires motor manufacturers to make service and repair information available to independent repairers to curb anti-competitive behaviour, should be extended to ensure independent repairers have fair access to vital parts to promote competitive pricing and support a more equitable repair market.
  • Regulate accident towing and storage fees. Introduce and enforce caps on excessive towing and storage charges across all jurisdictions. Examples of this include Queensland’s proposed reforms to extend fee caps to storage and secondary tows, and the expansion of Western Australia’s new towing regulations statewide to stamp out price gouging.
  • Crack down on insurance fraud. Strengthen industry and law enforcement collaboration to detect and prosecute fraudulent insurance claims. Through the ICA, the industry is investing in enhanced fraud detection and urging governments to bolster anti-fraud initiatives and penalties, targeting organised fraud rings that are increasingly active.
  • Regulation of credit hire. Stricter oversight of credit hire companies, such as through a mandatory Code of Conduct, to establish enforceable standards around disclosure and claims practices. This would help curb inflated settlement costs and excessive litigation, ultimately relieving pressure on premiums for all policyholders.
  • Reform New South Wales’ written off vehicle laws. To create consistency across Australia, New South Wales regulations should be amended to align with other states, allowing repairable total-loss vehicles to be safely re-registered after undergoing stringent safety checks

Without reform these upward pressures on claims costs will continue, putting affordable and sustainable motor insurance at risk for Australian policyholders.

Quote attributable to ICA CEO Andrew Hall:

A 42 per cent increase in premiums over five years reflects the costs that insurers are managing but is unsustainable for Australian motorists.

Insurers are doing their bit to reduce costs – such as streamlining operations, negotiating better repair arrangements, and investing in the repair workforce – but the reality is many cost drivers are outside the industry’s control. We need governments to step up with targeted reforms.

The Insurance Council’s roadmap lays out practical steps that, if implemented, will remove inefficiencies and unfair costs in the system.

We look forward to continuing our engagement with federal, state and territory leaders and encourage them to work with us on these solutions.

Australians deserve access to affordable and sustainable motor insurance, and that will only be possible if we address these cost pressures at their source.

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Motor Insurance Policy Paper: A Roadmap for Reducing Rising Premiums

New car theft claims data shows rises in Queensland and Victoria

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New car theft claims data shows rises in Queensland and Victoria

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News release

Tuesday, 18 March 2025

New analysis released by the Insurance Council of Australia (ICA) today shows that motor vehicle theft claims are increasing significantly in some parts of the country.

In 2015 the total value of motor vehicle theft claims was $170 million, or around $218 million in 2024 dollars. In 2024 the total value jumped to $428 million – a rise of 96 per cent in real terms.

Analysis of Insurance Statistics Australia data released today shows that across the same period the number of motor vehicle theft claims rose from 22,000 in 2015 to 28,000 in 2024 – up 27 per cent.

The picture varied considerably from state to state, with Queensland and Victoria experiencing the biggest increases (see tables 1 and 2).

The number of all Queensland claims rose 101 per cent and the value of those claims increased from $28 million ($36 million in 2024 dollars) to $113 million, or an increase of 214 per cent in real terms.

Over the same period the total number of motor vehicle policies in Queensland increased 32 per cent.

The number of all Victorian claims rose 70 per cent and the value of those claims increased from $46 million ($60 million in 2024 dollars) to $173 million, or an increase of 188 per cent in real terms.

Over the same period the total number of motor vehicle policies in Victoria increased 28 per cent.

Metro Victoria now incurs the highest cost of motor vehicle theft claims, reaching $140 million in 2024.

Queensland and metro Victoria saw the biggest increase in theft claim frequency (the incidence of motor vehicle theft as a percentage of total motor policies), with theft claim frequency rising by 62 per cent in rural and regional Queensland, 39 per cent in metro Queensland, and 34 per cent in metro Victoria (see table 3).

Western Australia saw a decrease in theft claim frequency between 2015 and 2024. Theft claim frequency held steady in rural and regional New South Wales while decreasing in metro areas, and in South Australia theft claim frequency held steady across the State.

Quotes attributable to ICA Deputy CEO Kylie Macfarlane:

Motor vehicle theft, while currently a small part of insurance premiums, is a growing concern.

The value of motor vehicles has increased significantly since 2015, as has the cost of parts and labour, putting upward pressure on premiums across the country.

However, the frequency of motor theft and the cost of that theft, as recorded by the insurance industry, should not go unrecognised.

This new data analysis shows alarming rates of motor vehicle theft claims in some parts of the country, which will ultimately cost us all.

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Public consultation opens on code of conduct

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Public consultation opens on code of conduct

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News release

Wednesday, 5 March 2025

Businesses, individuals and organisations are invited to have their say on a new Motor Vehicle Insurance and Repair Industry Code of Conduct which opens for public consultation today.

The public consultation will run for a period of eight weeks until Tuesday 29 April 2025.

In response to an independent review of the Code by Dr Michael Schaper in 2023, the Code Administration Committee (CAC), consisting of representatives from the Insurance Council of Australia and the Motor Trades Association of Australia, has collaborated with industry stakeholders to develop a consultation draft for public comment.

The updated Code aims to improve clarity, fairness, and effectiveness in several critical areas, including:

  • Sanctions and penalties
  • Assessment and estimation times
  • Methods of repair; and
  • Dispute resolution processes.

In addition to the draft Code, the consultation makes available proposed changes to the governance structure of the Code and formalisation of the Code Administration Committee under an incorporated association.

CAC Chair George Manos said the committee is calling for a diverse range of stakeholder input.

“As a committee we have worked hard to get to this point. We want to hear from insurers and collision repairers, as well as from broader stakeholders, including government bodies across the country,” he said.

“To support stakeholders navigate the proposed new Code, the CAC has developed an explanatory memorandum. Whether through the website or targeted industry engagement, the CAC has worked on making the consultation accessible for all stakeholders.”

Mr Manos also acknowledged that some stakeholders may prefer to engage directly with industry bodies.

“We want everyone to have their say. As a committee we welcome public submissions, as well as direct or confidential engagement with the Insurance Council of Australia and the Motor Trades Association of Australia,” Mr Manos said.

Submissions can be made on the consultation website at www.mviricode.com.au or by email to [email protected].

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MVIRI Code Administration Committee: Industry consultation on draft Code to open in early March

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News release

Thursday, 20 May 2021

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PDF- ICA releases independent paper on commercial insurance issues

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Get prepared amid early start to storm season for SEQ

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Get prepared amid early start to storm season for SEQ

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News release

Monday, 23 December 2024

With South East Queensland’s wet season already underway, the Insurance Council of Australia (ICA) is urging homeowners and tenants to take extra time to prepare for an extreme weather event.

The Bureau of Meteorology is predicting increased risk of extreme events this summer, with storms and flash flooding already hitting parts of the Brisbane and surrounds.

Extreme weather can strike at any time, however insurers see a greater number of events between October and April. Since 2013, 78 per cent of all declared insurance catastrophes have taken place between October and April and 90 per cent of catastrophe-related losses have been incurred in those months.

Before extreme weather season arrives, there are practical actions that all householders can take to prepare for and reduce the risk of extreme weather.

These include:

  • Inspect your property and take practical steps to reduce risk such as cleaning gutters, keeping lawns and gardens maintained and cleaning up green waste items around the property. Take the advice of relevant agencies in your area when preparing your home for summer weather conditions.
  • Prepare a room-by-room inventory of the contents of your home. This list helps determine if your assets are adequately protected and can save time when making a claim.
  • Use an online building and contents calculator to ensure your insurance cover adequately covers estimated costs to repair, rebuild or replace home and contents, vehicles and any outbuildings on your property in event of a disaster.
  • Review all building, contents, and landlord insurance policies. Make sure you understand what cover you have, as well as any exclusions or limits that may be part of your insurance policy. It is important to be aware of these exclusions and to query your insurer about any part of a policy you do not understand.
  • Ensure you are covered now before extreme weather threats are heightened, as some insurers may place a temporary embargo on the purchase of new policies if extreme weather is imminent.

Quotes attributable to Liam Walter, ICA Director of Mitigation and Extreme Disaster Response:

This month is on track to be the wettest December since 2010 with some areas already inundated with rain.

While South East Queenslanders are no strangers to storms during summer, it’s an important reminder to use the sunny days to get prepared – clean up around your home, clean those gutters and importantly, check your insurance policy.

Insurers are watching Queensland’s weather systems closely and are ready to spring into action and support residents should an extreme weather event take place.

We also recommend consulting your local state emergency service for safety tips, and to keep informed on the latest weather conditions.

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