Labor wins S.A. election

[octave]

58 minutes ago, Grumpy Old Nasho said:

NSW CTP insurance. You know, that one where you never get any of it back even if you never make a claim.

 

I suppose if you buy a lotto ticket and you don't win, you feel you are entitled to a refund. You don't seem to understand how insurance works.

[willedoo]

That's probably a similar rego cost for a four cylinder here in Qld.. All up somewhere in the 800 range; I pay 600 and something with the pension discount. I'd be  lot better off if it was a pay per mileage charge as I often only drive on the road once or twice a week, and not very far at that. A tank usually lasts a couple of weeks or three.

[willedoo]

It doesn't seem that long ago that a V8 was $800, but I think it's up around the thousand now.

[red750]

I only drive my 22 year old Holden Astra 4 cyl about 230 km per month. My 3 month rego renewal is due in a couple of weeks, for $116.34.

[onetrack]

You blokes don't know how good you've got it. My 2.7L petrol 2WD traytop Hilux costs $914 for annual rego. My diesel 3.0L Hilux traytop is $954 annually. My Ford Ranger 3.0L diesel 4WD traytop is $1017  annually. But my 5 tonne Isuzu truck is only $1050 annually. Go figure.

It used to be that small vehicles got a sizeable saving in rego - not anymore, it seems the authorities just want around $1000 for every vehicle on the road.

 

Edited Saturday at 01:53 PM by onetrack

[Grumpy Old Nasho]

4 hours ago, octave said:

 

I suppose if you buy a lotto ticket and you don't win, you feel you are entitled to a refund. You don't seem to understand how insurance works.

It's not compulsory to buy Lotto tickets.

[octave]

49 minutes ago, Grumpy Old Nasho said:

It's not compulsory to buy Lotto tickets.

But it is not compulsory to drive.

 

The fact is that people get injured in traffic accidents sometimes catastrophically. How, as a society, do we handle this?  Do we deny people the means to live,   perhaps as a paraplegic?

 

If this insurance were not compulsory, would you not have it?   If you were to cause an accident, would you be happy to be sued for every cent you have in order to provide for the person you may injure?   If you yourself had life-changing injuries, would you want to be provided the financial means to help you live?

 

You say you get nothing from this insurance, but what you get is protection from losing your house if you injure someone, and protection for yourself should the worst happen.

 

In life, there are rights and responsibilities. To want the rights without the responsibilities is childish.  Operating a car does involve responsibilities and expenses.  I am compelled to have tyres on my car that are roadworthy, the brakes must be serviceable, etc. (oohhh it's so unfair sob sob).

 

I have not had a significant accident in 46 years of driving; however, obviously, it could happen. I am not willing to lose my house if I injure someone. I also am not willing to be injured by another motorist, which could cause me to have to sell my house for my medical treatment.

 

Sorry, but this is just another one of your endless list of "whinges"

 

[old man emu]

It sounds like GON wnts the system that operates in the USA. Hurt someone with a vehicle and they sue you for millions in damages. They might win the legal argument and be awarded costs, but the average motorist cannot fork out the millions in damages, so the injured party gets nothing and the driver loses everything, if they have anything to lose.

[facthunter]

The STATE the Disunited States of America is in, No one in their right Mind would envy or seek to copy, and it's an INSIDE JOB. Nev

[Grumpy Old Nasho]

13 hours ago, octave said:

If this insurance were not compulsory, would you not have it?   If you were to cause an accident, would you be happy to be sued for every cent you have in order to provide for the person you may injure?   If you yourself had life-changing injuries, would you want to be provided the financial means to help you live?

If it was voluntary, I could haggle with the insurance company to get a premium assessed for my conditions such as safe driving record, my advanced driving course (Peter Wherret) I did in 1972, and my quiet almost traffic free location. And the average miles I clock up per year.

 

What we have at the moment is a compulsory one-size-fits-all, costing a small fortune, and if you never make a claim in your entire motoring life, you end up as a charity forking out tens of thousands of dollars for bad drivers, and for the Rolls Royce of the CTP insurer's CEO.

 

CPT insurers have "Good Driver" premiums where they knock a few dollars off. But the implication from that is, that there are also "bad drivers". Good drivers are just charities for bad drivers who have no eyes or ears.

[Grumpy Old Nasho]

13 hours ago, octave said:

You say you get nothing from this insurance, but what you get is protection from losing your house if you injure someone, and protection for yourself should the worst happen.

Because the promise of protection is intangible, you'll get absolutely nothing for your money if you never have to make a claim.  

[facthunter]

Get value then, Crash away. Insurance is to avoid risk of being exposed to a cost liability you can't cover. You are buying Peace of Mind. You CAN'T HAVE that and then say  "I want a refund". Insurance Companies DO have No Claim Bonuses. You should be able to work this out for yourself if you weren't so determined to be the "Greatest Whinger on the Planet"   Nev

 

[octave]

45 minutes ago, Grumpy Old Nasho said:

If it was voluntary, I could haggle with the insurance company to get a premium assessed for my conditions such as safe driving record, my advanced driving course (Peter Wherret) I did in 1972, and my quiet almost traffic free location. And the average miles I clock up per year.

 

If it were voluntary and a sizable chunk of drivers opted out, there would be a smaller pool of contributors, and most likely the cost would be greater.   I have no problem with a more sophisticated system where premiums depend on kilometres travelled, although this is complicated and discriminates against country people who may have to travel long distances. When I lived in the country, I did around 45000 km a year, and a trip to work was 100km each way (200 per day). Now I live in the city with good public transport, so I am around 5000 km per year. My compulsory insurance premium is probably subsidising country drivers, but I don't really mind. 

 

You say you could haggle, but I think your major complaint was that you seemed to believe your premiums should be refunded if you don't claim. So even if you could shave $50 of your premiums, you still would not get it back.

 

55 minutes ago, Grumpy Old Nasho said:

you end up as a charity forking out tens of thousands of dollars for bad drivers

The people in the hotel garden in Daylsford who were killed or injured by the driver, who had a medical episode, deserve something.  Compulsory insurance is not just to cover bad drivers; it is to cover the victims of bad drivers. I understand that you believe you are a great driver and could never make a mistake. That could be true (but I doubt it) but what if you are hit by a drunk driver or someone overtaking badly, or someone who drives through a red light, or perhaps answering their mobile and becoming distracted?  What you are saying is that your medical treatment or rehabilitation is purely determined by whether the driver who hits you has bothered to take out third-party injury insurance, and if they haven't, you are screwed. 

 

1 hour ago, Grumpy Old Nasho said:

Good drivers are just charities for bad drivers who have no eyes or ears.

That is the nature of insurance, and most grown-ups understand that. You seem to group drivers into good and bad and I suppose you think that only bad drivers are involved in accidents. Apart from the fact that everyone is capable of making a mistake, so-called good drivers are often the victims of bad drivers and perhaps bad drivers would be less likely to take out insurance. Where does that leave the good driver who is injured by the bad driver?

 

1 hour ago, Grumpy Old Nasho said:

Good drivers are just charities for bad drivers who have no eyes or ears.

Again, because you don't seem to be able to understand. CTP covers all victims of traffic accidents, whether they cause the accident or are merely victims of someone else's bad driving.

 

1 hour ago, Grumpy Old Nasho said:

Because the promise of protection is intangible, you'll get absolutely nothing for your money if you never have to make a claim.  

I don't know how many times I can say this. You do get something; you get some protection from being sued, and you also get some level of financial protection should you yourself be injured.

 

I can't understand why you can't comprehend how insurance works. Perhaps you don't understand that the money paid out to claimants IS from premiums paid by people who do not claim.

 

To use the example of a raffle, I recently bought tickets from a charity. The price is a campervan worth 165k. This vehicle is paid for by all of the ticket purchases.  If all the people who did not win were to be refunded, how would they pay for the prize?

 

At this point, you are going to say that the difference is that buying a raffle ticket is not compulsory, and that is true. Let's consider this. You employ an electrician to do some work on your house. They screw up, and your house burns down. My understanding is that electricians have mandatory Public Liability Insurance. This would pay to rebuild YOUR house, and I suspect you would be here whinging (again) if your house burnt down and there was no insurance.

 

How are you not getting this or is it a case of your usual modus operandi being to whinge about everything?

 

When I was flying, I understood that I had obligations. I accepted this like a grown-up. These obligations were onerous, and for many years I accepted them. The last thing I would do is cry on my friend's shoulder and say, "Oh, it is so unfair," because to me, that is a loser move. 

 

Driving a car is not necessarily cheap. Some people can't afford to replace worn tyres, sad but tough luck. If you want to operate a machine, you have to ensure that you are not endangering people either physically or financially.

 

I assume you are struggling financially. As an act of charity, I am happy to donate $50 towards your CTP if you are genuinely struggling. 

 

  

 

 

[old man emu]

13 minutes ago, octave said:

sophisticated system where premiums depend on kilometres travelled

The present system for costing this insurance is probably the best way to remove the complexity for calculating a premium based on annual mileage. I don't know if it still applies, but back in the day the premium was reduced a little bit for vehicles garaged outside the Metropolitan Area of Sydney.

 

Consider this. In NSW when you get your annual roadworthiness certificate (pink slip), the mileage is recorded. A lot of people wait until the last minute to get their pink slip. The premium for CTP, if based on mileage would have to be calculated before a renewal notice could be sent. Very inconvenient for paying rego on time. As it stands, I get my CTP renewal notice a month before the due date, so I can pay it any time after that, and before the expiry date. Knowing how much the premium will be lets me put a few dollars aside each pension day throughourt the year so that I don't have to worry that I won't have the money necessary when I want to pay it.

[octave]

3 minutes ago, old man emu said:

The present system for costing this insurance is probably the best way to remove the complexity for calculating a premium based on annual mileage. I don't know if it still applies, but back in the day the premium was reduced a little bit for vehicles garaged outside the Metropolitan Area of Sydney.

 

 

Yes, OME, I am in complete agreement with you. My reference to mileage was just to throw a bone to poor old GON.

[Jerry_Atrick]

GON, I don't know if you are serious of just ship styirring. If the former, you clearly don't understand what insurance is:

 

3 hours ago, Grumpy Old Nasho said:

Because the promise of protection is intangible, you'll get absolutely nothing for your money if you never have to make a claim.  

The promise is very tangible. It means a) if you hit someone and you are at fault, you are protected from any claims they have on your property. More importantly, the non voluntariness of it means that if someone hits you and it is their fault, because it is government guaranteed, you are guaranteed to get the treatment and compensation for your injuries and I believe loss of income, but owuld have to check. This is a very tangible promise and as absolute as it can be. Of course, if the driver doesn;t have insurance to cover property damage (i.e. your car's damage), then because that is a voluntary form of insurance, you may have to go for them, if they have anything, to recover yuor costs. But CTP is only personal insurance and the state (and community, I dare say) agree that this is a vital protection to protect the interests of the community in gerenal. 

 

In addition, it helps to pay for the even worse drviers who drive cars without current reg and CTP, who, if they hit you, would not have any way to pay for your treatment or lost income.. But, hey, if that is your preference, then I guess you can find somewhere in the world to live where it is optional. Not too many western countries, USA included, don't require CTP insurance. 

 

I think you are mixing up insurance with investment products, where you earn a return on your money. With insurance, you p[ay a premium for protection for a specific period of time. They work out the expected cost of the scheme, which, apart from admin, is the cvost of the claims they expect, how many policies they will have to write, and to cover for oninusred people (where participation and payouts are compulsory). Yes, you will be covering someone who has a worse record than you, and there are others, such as Octave that are likely to drive a lot less than others, and he is covering some of your expense (on the assumption you drive materially more than 5k kms a year). You are not paying for the claim.. otherwise, there would be noo point to insurance. 

 

3 hours ago, Grumpy Old Nasho said:

If it was voluntary, I could haggle with the insurance company to get a premium assessed for my conditions such as safe driving record, my advanced driving course (Peter Wherret) I did in 1972, and my quiet almost traffic free location. And the average miles I clock up per year.

 

Now that I am composed.. When was the last time you haggled with car insurance? I think you mean you can shop around. And yes, you could. But, you;re mixing up voluntary insurance with privatisation. The UK and the US have privatised CTP, but it is still mandatory. There is a theoretical argument for privatised CTP as it shoudl intorduce competition and it should lead to more competitive pricing. But the reality is sort of. 

 

The isurance market is made up of brokers, reinsurers, and underwriters. Most of the insurers you see on TV/hear on radio are brokers/agents or reinsurers. Some, such as AAMI are direct underwriters. A broker is a commissioned agent - they receive a comission for each policy sold. A reinsurer accepts some of the risks but transfers the vast majoprity of the risk to underwriters. The nature of the risks adopted by reinsurers are the long term catastophic risk that occurs really infrequently. The everyday and common stuff is transferred to the underwriter. 

 

If you go to the underwriter direct (e.g. AAMI), they take on all the risk and cost. They calculate you premium as if you went to a reinsurer. 

 

So, for every insurance policy, regardless of where you go to get it (ie. haggle for it - that still cracks me up), it will involve an underwriter's premium plus a reunsurers premium what what they call the long tail risk, polus the brokerage commission (it is rare an underwriter or reinsurer will discount the broker fee in the same way wholesalers generally don't stff their retailers. Yeah - I know there are some do it, but their marketing approach is to not use brokers or price comparison sites - which are also just self-service  brokers).

 

What will tend to happen is that you will find there ae very strict regulations around the provision of CTP insurance because the government have to be comfortable that the private insurers can meet their obligations - especially since it is a compulsory insurance - otherwise there is no point to the insurance. So, there is this thing called regulatory capital they have to hold based on their forecast obligations over different time horizons, because their revenue is not guaranteed. This may sound counter-intuitive, but it is possible to have a future liabillity for which you are no longer receiving a premium payment. For example, if you were iwth insurance company X at the time you hit a pedestrian because you didn't see them, that claim and associated cost could go on for years, but you may switcvh insurer because insurance company X just jacked up your premium. They still have to pay the claim for years, while you are now with insurance company Y. And it does happen quite a lot, so the private insurer has to cover a cost that a government insurer doesn;t have to as much (yes, they can - you can move interstate, or you can stop driving, but the numbers are far less than a priovatised multi-provider industry). 

 

The other thing is, it is not a fully competitive market. First, there are really high barriers to entry as you have to have a lot of money to be able to meet all your regulatory requirements - which are there to ensure sovency of the insurers so they can pay out (interestingly, the UK prudential regulations are called Solvency, with the current regs being Solvency III, I think). Then you have to have enough liquid assets to pay the claims when they fall due. Not only that, but each underwriter and insurer has to duplicate the administration and operations of the insurance sheme they operate.. More actuaries, quants, admin staff, claims staff, etc., medical teams/panels and the like that are not able to be utilised by curernt insurers as they don't have those liabilities today. 

 

The number of underwriters is small - according to Google, there are only 4. I think they have missed a couple - so lets say 6. Ironically, 1 per state, and none for the territories. First, you;re not going to get much competition,  but since they are all subject to the same rules and have to cover the main risks, and because this is a compulsory insurance, they will ultimately have to cover some for uninsurd risk - where you will make a claim against your policy even though you are not at fault, you won't get too much competition in this space. Even though you may never had had an accident that is your fault, they are looking at the likelohood of you causing an accident, and as they saying goes, past performance is only a guide. You're getting older, your refelxes aren';t as good as they were, you're eyesight not as good as it was, etc. You probably don't want to hear it, but you could be entering the age where you are more likely to cause an accident and have a claim that a fit 40 year old who is mildly aggressive at the wheel. I think that is a reason why we tend to slow down as we get older. 

 

Be that as it may, they will work out an average cost per insured and then apply a small discount or premium for your future probability of risk, of which your past will come into it, but not the only, and in some cases, definitive factor. 

 

Then you go to the reinsurance premium. This is where your risk profile has much more of an impact on your premium. Also, your no claims years is likely to be taken more account of here than in the underwritten part of the risk because, although they hold the more catastophic risk here, it tends to be the very low probability stuff. Therefore, driver behaviour will more affect thei likeihood of a claim against this risk than a pure mishap that can give riske to claims under the risk the underwriter holds. The BMW plouhing into the beer garden in Dayesford is an example of that. Teh damage to the pub and the claims by people in the beer garden will probably fall on the reinsurer. But how often does that type of event happen? Very rarely in comparison to the fun of the mill hit and run, or bingle from failing o stop at a give way sign, I would guess. The reinsurer will has to cover losses of an uninsured driver doing the same as the BMW driver as well. So, that gets added eually to all premiums. 

 

The brokerage is immaterial, as it will usually be the same regardles of who the insured is. 

 

But, yes, you will be able, thankls to reinsurance, get a discount compared to higher risk drivers on your CTP. Well done. 

 

Except, there is one problem under a privatised model. And you only have to look at the USA and UK to find it. 

 

You get huge discrepancies as a result. The 18 year old in a Ford Focus (so not too powerful. but no slouch) is paying, say £1500 for CTP alone, which you may be getting it for £150. You havbe to have at least CTP to regisster your car or transfer ownership. So, he musters the £1,500 and pays it, registers the car, and the very next day cancels his insurance and gets all of it back. He is now uninsured. There are no ongoing checks (although with ANPR, they are bing picked up more often than they used to). So, now you are more likely to be hit by an uninsured driver. To get your treathment/compensation, you don't go to your insurance company, because they pay a premium to a fund that covers uninsrued accidents (third party being the operative term in CTP). You go to your insurance company and they will handle the claim for you (you pay for that as part of your premium, by the way), but they don;t administer the claim. And, because your uninsured driver may have done a runner, it coiuld be a long time before you see any of it, because they need to satisfy themselves it wasn't your fault before they accept an unisured liability. In the mean time, you could be in pain, lose your income, you job, etc for a very long time before you can get any money or treatment beyond the very basic, etc. 

 

Not only that, but because the number of uninsured drivers is higher and they are, for reinsurance purposes, in the higher risk category, thes uninsured fund will demand more premium form the insurers. And that will mean more premiumn to you - remember we are talking mandatory/compulsory insurance here. 

 

Which will mean, you probably won't save as much as you think. You're older, so you;re more of a risk whether you like it or not; you've still got to cover at least some of those that aren't as good a driver as you thanks to the underwriting component. And thanks to the privatised component and not hooking it up to your rego, you now have to cover an unisured fund as well as the need to make profit that will drag that difference to a lot lower than you think. 

 

Australia (or the states) have got it right. Just check out how much we actually pay for a private CTP insurance is in the US or the UK (and yes, for the US, you have to take into account the ridiculous sums of compenation they pay - so not entirely apples with apples). 

[Grumpy Old Nasho]

We are still charities if we never make a claim. My charitable contributions at the end of my motoring life if I never make a claim, will be approximately $35,000, adjusted for inflation.

 

At that time, the intangible promise by the company to pay for medical treatment for bad unsafe drivers, extinguishes. I will lose every cent of that tangible $35,000. It is tangible, isn't it, or is it in my imagination.

 

I will be expected to cop that on the chin, its the worst deal ever, if I never make a claim.

 

If CTP were to remain compulsory, then at least give us all the chance to negotiate our own premium. A form could be filled out ... "Have ever completed an advanced driving course?" "Have you ever made a claim against a CTP provider?" "Do you live in a densely populated area?" "Have you ever been involved in a vehicle crash on public roads?" "How often do you drive after sunset?" "How many demerit points have you acquired in the last five years?"

 

"In your own words, tell us more about why you think you deserve a cheaper Greenslip?"

 

Something like this needs to be done for a fair go for motorists. Our money is tangible, a stand-alone promise to pay is not, it's only a promise to pay bad drivers, and the rest of us (safe drivers) who never make a claim, are asked to provide the funds, never to see our money again. Forced charity.

 

 

[red750]

GON,, go out and have an accident. Break a couple of legs, lose an eye, then make a claim. That way you'll get part of your money back, at least.

[Jerry_Atrick]

56 minutes ago, Grumpy Old Nasho said:

We are still charities if we never make a claim.

No.. You're not paying for a claim. You are paying for an indemnity shoud there be a need to make a claim against you - even by yourself. In other words a guarantee should you need it.  That is what insurance is. To say what you say is, from an insurance perspective, say, "I am going to prepay a claim that will be made. If I make no claim, I want my money back". Think about it, the insurance company would then have specify the type of claim and value it is willing to shell out. That third party claim, say for dismembering a leg, may be worth, I dunno, say $1M. That woudl be yuour payment.. because they will pay your claim. If at the end of your driving, you don't make that one claim for dismembering someone's leg, then yiouget your $1M back, minus some margin for admin + profit. 

 

Now, if you make the claim because you do dismember someone's leg, there goes your $1M. That is a lot more expensive than the $35K that you paid in indemnities or guarantees - which is what insurance is. It is a small fee to protect you from a much larger cost. 

 

But, if you, say, I dunno, cause someone brain damage, then you have not paid for that type of claim - you are on your own. Or maybe the prepaid claim service will  pay to the value of any claim up to the amount you have prepaid. In which case, that person who has brain damage may claim $10m. You have pre-paid your $1M claim, but they bankrupt you (or take another $9M if you have that available in realisable assets at current value). That is what you are describing in the above,

 

As an analogy, in trade finance, we will provide letters of guarantee on behalf of clients who are importers. It is a bank guarantee to their suppliers overseas that once the goods are shipped to the point of delivery, we will release the funds to the exporter regardless of whether or not we have those funds. We charge our client (the importer) a fee for this service on the understanding that they will have the funds, and if they don't they also have an interest fee that accrues until the funds are provided to us. If, as they normally do, have the funds available at the right time, we don't give a refund on the guarantee we wrote. We provided them a service which allowed them to purchase the goods/services in return for the risk that we took on - i.e. transferred from the exporter to us. 

 

You clearly do not understand what insurance.  

 

 

1 hour ago, Grumpy Old Nasho said:

At that time, the intangible promise by the company to pay for medical treatment for bad unsafe drivers, extinguishes. I will lose every cent of that tangible $35,000. It is tangible, isn't it, or is it in my imagination.

It is not an intangible - it is a promise backed my a tangible promissory note being your insurance certificate. As long a you have that and it is within its insurance period, it s able to be touched and relied upon. Under international accounting standards, regulated insurance certificates sit on the tangible assets of the balance sheet and decreases from the balance sheet on a monthly basis and is charged to expense. You have lost notning. You have paid for a tangible service and you have received it. You are not paying for a claim itself. That is a conditional obligation of the insurer under the terms of the indemnity. Whether it is privatised or a state administered insurance scheme, it doesn't change. Whether it is volunatry or not, it doesn't change. At the end of the insurance period, you do not get your money back for making no claim. 

 

1 hour ago, Grumpy Old Nasho said:

If CTP were to remain compulsory, then at least give us all the chance to negotiate our own premium. A form could be filled out ... "Have ever completed an advanced driving course?" "Have you ever made a claim against a CTP provider?" "Do you live in a densely populated area?" "Have you ever been involved in a vehicle crash on public roads?" "How often do you drive after sunset?" "How many demerit points have you acquired in the last five years?"

If CTP were not compulsory, and you decided to take out TP Insurance, in order for you to claim for losses of uninsured drivers, your premium would skyrocket (assuuming they offered the choice just for your policy to protect others and you be on your own if an uninsured). By being voluntary, you may decide you don't need the insurance and I have to protect myself against you. No matter how good you are i the past, if you do me damage, I would have to have some form of comprehensive 3rd party insurance to cover my personal injuries from uninsured drivers like you. Now you're aslking me to pay for you. Now, ask yourself, who is likely not to take up 3rd party insurance if it were not compulsory. I may be stereotyping here, but I am thinking it would be the ones more likely to cause injury than not - those less responsible in their outlook, etc. All that will happen is for you to protect against the thrid party risk is that your third party premiums will increase as a result. Well done, ol' chap. 

 

 

What you describe is not a negotiation. It forms part of the risk assessment. All this is taken into account. The states licensing agencies already have most of the information, and I am afraid a road safety course in 1972 is probably not going to be considered terribly relevant today.

 

As I explained, the underwriting risks do not vary a lot between even the worst drivers and the best in terms of premium. That is because the risks they insure are generally likely to be caused by anyone with a momentary lapse in concentration. Also, they are looking at future risks, and given you were driving in 1972, I would say you are entering, if not already in a high risk zone. 

 

You can't do a simple bell curve of number of accidents per age group due to the difference in the number of drivers per band, but I got Chat GPT to do the heavy lifting and scale the nubmer of accidents per age band relative to the population of drivers in each age band:

 

You can see, as you get older, the number of accidents per population increased from 60 onwards. So, GON, you are not in good future risk territory straight away. But, also the severity per accident increases:

 

In your age group, it is also the severest, which means probably the highest payout per claim, which means, you can try and negotiate. Good luck! There's a reaon its hard to hire cars when you're under 25 and over 75:

 

You can privatise it all you like, but unless, as I mentioned earlier, you're in the sweet spot of driving, you are likely to be paying more, and in your case, given your demographic's elevated risk of causing an accident, and then even higher than the youngan's in the severity and likely cost of the claims, you may want to be careful what you ask for.. you may get it. 

 

[Grumpy Old Nasho]

The promise extinguishes when a motorist hands their license in at the end of their motoring life. In my case, that promise will cost me $35,000 if I never make a claim.

 

I'll be old, unable to drive any longer, and I'll never see any of that $35,000 ever again. It'll be in someone else's very tangible pocket, certainly not mine. 

 

It's stolen property, in the guise of insurance premiums. Interest is earned on it, but we never get handed any of that interest. They're making money out of ill gotten gains. Who said they can invest it? When I deposit money in my bank, I get a good share of the interest.

 

 

[Jerry_Atrick]

The indemnity ceases at the end of the term. Each year, your inusrance expires and that, say $400, has paid for the indemnity for that period of time. Then when you renew, it is a new indemnity for all intents and purposes. 

 

I will try and explain it for a 5 year old.

 

When you drive, you have a contingent liability - that is, while you are driving, you are accepting that should you have an accident that is your fault and you injure someone (physically or mentally), then you will be liable - or responsible - or be required to pay the injured party for their medical treatment - for how long that will take, any lost income, and potentially damages for pain and suffering (ex Vic, I think). 

 

That means, if you cause an accident and a severe injury to someone else, your liability will kick in and the costs of medical treatment (think chronic and continuing) can easily run into the millions. And the loss of include can easily also run into the hundreds of thousands and if long enough - even milltions. 

 

Clearly, all but a very few drivers in society can afford that sort of liability. And clearly,  this will only happen to a few drivers out of the population, So, rather than be in a position where you cause someone a severe injury that bankrupts you and means the victim does not get the treatment or compensation they deserve, the government, with good judgement has deemed that this risk must be transferred to an insurer that can pool the premiums of many drivers and therefore have enough to pay for the likely number and cost of claims that will arise as a result. This is common to virtually every western government/society, because these societies have decided that it is a high priority that the person is protected as much as possinle in an activity which has a fairly high chance of something going wrong. This to me is a sound decision, because it means the victim can get the treatment, lost income, and compensation that would be right for them to receive as a resuilt, and the driver is not bankrupted at the same time. Everyone is happy (as much as they can be in these citcumstances).

 

So, the $400 you pay gives you unlimited protection - you can kill and maim as many people as you want as long as it was accidental, and you won't pay a cent for their compensation nor costs. You can literally run up 10s of millions of dollars in long term liability over the duration of your insurance coverage - which is one year, never pay another penny as you decide it is time to hang up the car keys, and that is it. $400 to me seems a bargain.

 

Of course, it is a furphy to say in most of Australia it is your choice to drive - especially in the sticks. The reason is that Australia is so heavily dependent on cars - even the big cities really do require them - especially in the outer suburbs. But because cars (and motorbikes, and trucks, and vans, etc) can be quite lethal, a part of the cost is ensuring that you asre covered in the case of you causing an accident and personal injury as a result. You need a car- they aren't free. You need petrol (or electricity) - that isn't free (well, for some, sort of is, but lets assume depreciation of solar cells). You have to register the car to pay for things like the roads; that isn't free; and insuring your car, even if you don't claim, isn't free. You have to accept it as a cost of driving. Note, you don't have to have third party property or comprehensive insurance. The goivernments have said, in the priority of things, they have left this totally up to the driver. If you do not want to transfer that contingent obligation to an insurer and protect what assets you have, that is entirely your business. 

 

At the end of each year, your insurance expires. The indemnity provided to you has to be renewed. As I said, you don't have to renew it if you don't want to drive. You may have in the last year caused an accident that has led to someone needing a large amount of care over a long time, list $150k.year salary, and is in constant pain and suffering. Because you stop renewing your premium, does not stop the liability of the insurer (although sometimes there is a big one off payout to cover for the years of assistance, lost income and pain and suffering, it is rarer these days, where the costs cannot be predicted accurately). 

 

But, you may not have an accident that is your fauit. Which means no liability of the insurance company (or more accuately no liability to you, which is indemnified by the insurance company) arises. OK.. that is why you are paying only $400 for the year and not $1milliion or $10m. That is because, insurance is about pooling contingent obligations and paying out when the events that give rise to those obligations occur.

 

Still with me? I assume you are. In that way, it does share the burden across people, but make it a lot smaller than a massive and usually unable to be met burden across a much smaller number of people. This makes driving accessible to all, including you. The government, and most of society I would hope, would deem ensuring every driver has sufficent means to pay for any accident they cause that results in personal injury. If you don't want to pay someone else to take the risk on for you, then I would suggest the government would want some form of security from you that you could cover any likely oblligation if it arose from you causing an accident and injuring someone. That would mean they would a) take a lein over your house.. But it is unlikely most peoples' properties would cover what can be likely to arise int he obligation. So, don't worry, they will give it back to you when you stop driving, but they will take a $1m+ sureity deposit from you. Now, you may be able to cough up that amount of money and let the government hold it on your behalf, but most wouldn't and not too many people would be able to drive - legally. 

 

So, yeah. you are paying for something where you may never give rise to an obligation, but that is the cost to make it accessible not only to you, but to all.

 

But, why can't you just pay the prevoium and get it back if you don't make a claim?

 

Well, it wouldn't take too much brain usage to work that one out. ChatGPT tells me there is no relianle stats that say what percentage of drivers in australia cause an accident that results in personal injury. But using statistical extrapolication methods, it calculates up to 0.5% of the population. 

 

So, for every 200 drivers out there, 1 will cause such an accident. 

 

The average cost of compensation will is around $118,000; some are low, and some are very high.  Again, according to ChatGPT, so pls take it as, at best a guide. 

 

So, given for every 200 drivers there will be, on average, 1 driver that causes 1 accident and the cost per accident per year will average $118,000..  Let's not even bring the per-annum dimension into this. 

 

So, assume the CTP insurance premium for all 200 drivers is over their life time, $35,000. Let's assume they all start and end their driving at the same time. 

 

Now, all the drivers that didn't have a claim will get there money back, which is what your asking for That leaves the money of the driver - $35,000 - in the scheme. However, the one accident has cost the scheme $118,000. Now, take into account all of the drivers, and all of the accidents, and the range of costs, and the fact this is an annual number not the life of a scheme number, and you can see it will take all of a year for the scheme to go bust or be a massive drain on the public purse. Which means more taxes, or rego to cover it.. 

 

What you are suggesting is a complete folly - in other words BS. 

 

Here is the hcart of the average cost of the personal injury claims from accidents by age group. Guess which age group has the highest. Yet, your policy price is the same as those with the lowest. 

 

If you have been driving all your adult life, you're about even. Up to about 30, and above 60, you are costing more than between 31 and 59 - on average. Therefore at the moment, almost all those younger than you are paying more to cover your risk. Yes, you may be the bestest driver at your age, so you may wualify for a small discount. But the risk assesment tells the insurers you aren't a great risk, buit better to slug those younger than you than make you pay more.

 

I honestly don't understand what you are complaining about. Imagine if the insurers had to make a profit. You'd be paying as much, if not more than the UK and US folks do.

 

 

 

 

Edited 7 hours ago by Jerry_Atrick

[octave]

4 hours ago, Grumpy Old Nasho said:

It's stolen property, in the guise of insurance premiums. Interest is earned on it, but we never get handed any of that interest. They're making money out of ill gotten gains. Who said they can invest it?

Who says they do invest it? If they do, it is very short-term. You seem to think that the premiums you pay are pure profit without seeming to understand that the money they pay out to people injured IS comprised of all the premiums paid.  If they gave back all premiums of people who did not claim, there would be no money to pay out.

 

The idea that the only value of insurance is if you make a claim.  When I lived in the bush, I had house insurance. One year I dropped the ball and neglected to renew.   When I discovered that I was anxious, as it was a bad bushfire season. Once I renewed, I relaxed knowing that if my house burnt down, I would not be destitute. That is the value of insurance.  Two years after I sold this property, a bushfire ripped through this area. Fortunately, the house did survive, although I am betting there was some damage, and I imagine a claim by the new owner would have been made.

 

During most of my working life, I was self-employed or worked under contract to someone else.  I was required to have public indemnity insurance, yeah, sure, a bit of a pain, but at least if I crewed up or even was accused of screwing up, I would not lose my house if sued. That is the value of insurance.

 

Last year in NSW, 331 people were killed, and a huge 11120 were seriously injured.  In your world, would these seriously injured only be looked after if they or other involved drivers chose to take out insurance?  

 

About 25 years ago, my wife was driving in a car park. A car full of young hoons smashed into her. She was unharmed, but the car suffered a lot of damage.  This was quite an old car, so we did not have comprehensive insurance; however, of course, being responsible people, we did have 3rd party property. These hoons had no insurance. In the end, we could not get any money out of them and ended up scrapping the car at our expense.   Now this was just a matter of damaged property but imagine this scenario if there had been injuries and the drivers had no third-party injury insurance.

 

The bottom line GON is that in a modern, civilised society, we do subsidise each other.  Although wage earners pay a Medicare levy, it does not fully cover a long hospital visit. Yes, the people who are healthy and need little medical care do subsidise those who require care. Sooner or later, all of us will need care. The fact that if I have an accident, there are medical facilities available is the mark of a modern, civilised society.

 

 

 

 

 

 

[old man emu]

Insurance: There but for the grace of God go I.

[red750]

GON, You complain that the CTP is compulsory. That's what the "C" stands for, Compulsory Third Party.

 

But it's only compulsory if you drive. Don't drive and you won't have to pay.

 

It's like travelling on a train or bus. Buying a ticket is compulsory. Don't travel by bus or train and you don't have to buy a ticket.