Most small businesses look set to be well covered by the federal government's $500 million bailout package for failed insurance group HIH.
The criteria set by Financial Services & Regulation Minister Joe Hockey will see 100% of personal injury claims against small businesses paid, and 90% paid for other claims when the insured was a small business (50 employees or fewer).
The government will shortly put in place a public awareness campaign and advertise a hotline for HIH
policyholders to apply for assistance.
Assistance will come from the Commonwealth Government Budget via a not-for-profit company, HIH Claims Support Pty Ltd (HCS). HCS will provide claims management and payments services on a cost-only basis supplied by 4 Australian insurers - QBE, NRMA, Allianz and Royal & Sun Alliance.
The government will pay 100 cents in the dollar for:
- people with salary continuance policies who are Australian citizens or permanent residents
- personal injury claims where the insured is an Australian citizen or permanent resident or small business
- claims for a total loss on a primary place of residence where the insured is an Australian citizen or permanent resident
- claims where the insured is an Australian not-for-profit organisation.
The government will pay 90 cents in the dollar support for:
- other claims where the insured is subject to an income test as follows:
- Where family taxable income is less than $77,234 (increased by $3,139 for each additional child), a policyholder qualifies regardless of the size of the claim
- Where family taxable income is more than $77,234 (increased by $3,139 for each additional child), a policyholder qualifies for assistance if the claim is more than 10% of family taxable income.
- claims where the insured is an Australian small business that has 50 employees or less.
Relevant dates
The payment of support will only be available where a claim has been made before June 11, 2001 or a claim related to an event that occurred before June 11, 2001.
Anyone who has not taken out a new policy and is currently insured with HIH should seek a new policy as quickly as possible, because events that occur after midnight June 10, 2001, will not be covered by this package.
For more details, visit
www.minfsr.treasury.gov.au.