SIRA quarterly regulatory update (period ending 31 March 2024)
This report is a summary of the regulatory activity undertaken by the NSW State Insurance Regulatory Authority (SIRA) relating to the compulsory third party, workers compensation, home building compensation schemes and healthcare providers operating in the schemes, for the period 1 January 2024 to 31 March 2024 (figures presented are as of 26 April 2024).
These schemes provide an important social safety net for the people of New South Wales (NSW) who may one day experience injury or loss. SIRA works to ensure these schemes are fair, affordable and effective for policy holders, and for people who make a claim for compensation.
SIRA’s Regulatory Framework details the approach SIRA is taking to deliver its regulatory functions under the State Insurance and Care Governance Act 2015.
SIRA’s compliance and enforcement activities target the areas of highest risk. The actions taken are commensurate to the level of real or potential harm, the scope of non-compliance, the severity of wrongdoing and the need for deterrence. These activities are complemented by education and support initiatives to drive better outcomes for the people who make claims and hold policies in SIRA-regulated schemes.
Compulsory Third Party Scheme
In the NSW Compulsory Third Party Scheme1, SIRA regulates 6 licensed insurers; Allianz Insurance, Insurance Australia Limited (trading as NRMA Insurance), AAI Limited (brands: AAMI and GIO), QBE Insurance (Australia) Limited (trading as QBE), and Youi.
Regulation of insurers
Letters of censure, Letters of compliance, Special license conditions
No letters of compliance, censure, or special license conditions were issued by SIRA during the period 1 January 2024 to 31 March 2024.
Remediation plans
Insurers are required to implement a remediation plan where non-compliance with their obligations has been self-reported or determined by SIRA.
No new remediation plans commenced during the period 1 January 2024 to 31 March 2024.
As of 31 March 2024, there were a total of 18 remediation plans in place for CTP insurers.
| Insurer | Date commenced | Matter |
|---|---|---|
| AAMI & GIO | 20/01/2023 | Motor Accident Injuries Act 2017 self-assessment 2022. |
| AAMI & GIO | 23/01/2023 | Non-compliance with recovery planning obligations. |
| AAMI & GIO | 02/08/2023 | Non-compliance with weekly benefits obligations. |
| AAMI & GIO | 02/11/2023 | Non-compliance with communication of entitlements obligations. |
| AAMI & GIO | 07/11/2023 | Motor Accidents Compensation Act 1999 self-assessment 2023. |
| AAMI & GIO | 21/11/2023 | Non-compliance with claims involving death obligations. |
| NRMAI | 10/02/2023 | Non-compliance with recovery planning obligations. |
| NRMAI | 15/08/2023 | Non-compliance with weekly benefits obligations. |
| NRMAI | 10/10/2023 | Non-compliance with communication of entitlements obligations. |
| NRMAI | 13/10/2023 | Motor Accidents Compensation Act 1999 self-assessment 2023. |
| NRMAI | 06/11/2023 | Non-compliance with claims involving death obligations. |
| QBE | 27/02/2023 | Non-compliance with recovery planning obligations. |
| QBE | 06/09/2023 | Non-compliance with weekly benefits obligations. |
| QBE | 20/11/2023 | Non-compliance with claims involving death obligations. |
| Youi | 15/12/2022 | Motor Accident Injuries Act 2017 self-assessment 2022. |
| Youi | 24/02/2023 | Non-compliance with recovery planning obligations. |
| Youi | 02/08/2023 | Non-compliance with weekly benefits obligations |
| Youi | 04/12/2023 | Non-compliance with claims involving death obligations. |
Motor Accident Business Plan review
Licenced insurers must, as a condition of their licence and under section 9.18 of the Motor Accident Injuries Act 2017, prepare and deliver to SIRA a Motor Accident Business Plan (business plan) for its CTP insurance business.
SIRA undertakes a comprehensive review of the insurer’s business plan to ensure that it is in accordance with the Motor Accident Guidelines and supports the insurers to meet their legislative and licencing requirements.
SIRA has reviewed and formally responded to all licenced insurers and did not object to any of the business plans provided.
Fraud on the Motor Accidents Scheme
Fifteen new referrals have been received during the quarter (9 from insurers and 6 from SIRA's CTP Assist team). There are currently 15 open investigations in total.
Workers Compensation Scheme
In the NSW workers compensation scheme, SIRA regulates 4 types of insurers - the Nominal Insurer managed by icare, self-insurers, specialised insurers, and government self-insurers (the Treasury Managed Fund) managed by icare and employers.
Regulation of insurers
Letter of Censure
No letters of censure were issued this reporting period.
Special licence conditions
Special licence conditions were placed on 2 insurers in the reporting period.
| Insurer | Date commenced | Reason |
|---|---|---|
| Commonwealth Steel Company Pty Ltd | 28/02/2024 | Additional business information reporting. |
| Liberty Holdings Australia Ltd | 29/02/2023 | Compliance with remediation plan. |
Special licence conditions remain in place for:
| Insurer | Date commenced | Reason |
|---|---|---|
| Aldi Stores – A Limited Partnership | 24/02/2023 (updated 24/02/2023) | Improve case management compliance and claims management practice. |
| Catholic Churches Insurance Ltd | 19/05/2023 | Cease to offer policies from 30 June 2023. |
| Coca-Cola Europacific Partners | 31/08/2022 | Improve case management compliance and claims management practice. |
| DAC Finance | 30/08/2021 | Additional business information reporting. |
| Fletcher International | 31/10/2022 | Improve case management compliance and claims management practice. |
| Healius Limited | 19/12/2023 | Additional business information reporting. |
| Holcim (Australia) Holdings Limited | 01/12/2023 | Additional business information reporting. |
| Inghams Enterprises | 20/01/2022 | Additional business information reporting. |
| Racing NSW | 22/04/2022 | Improve case management compliance and claims management practice. |
| The Star Entertainment Group | 01/11/2023 | Improve case management compliance and claims management practice. |
| Toll Holdings | 28/02/2023 | Additional business information reporting. |
| Ventia Australia Pty Ltd | 15/06/2023 | Requirement to implement and report remediation activities to address identified claims and injury management performance issues. |
Letters of compliance
Two letters of compliance were issued to icare in the reporting period:
- One letter for use of surveillance and factual investigations not in line with standards of practice.
- One letter for management of 2 complaints regarding premiums not in line with SIRA’s Customer Service Conduct Principles.
Remediation plans
Six remediation plans commenced or were requested in response to SIRA supervision activities:
| Insurer | Date | Matter |
|---|---|---|
| Brickworks Limited | 5/03/2024 | Remediation plan required following claims performance audit. |
| Food Investments Pty Ltd | 1/03/2024 | Remediation plan required following claims performance audit. |
| NSW Trains | 21/02/2024 | Remediation plan required following claims performance audit. |
| Thomas Foods International Consolidated Pty Ltd | 6/02/2024 | Remediation plan required following claims performance audit. |
| Sydney Trains | 23/01/2024 | Remediation plan required following claims performance audit. |
| Racing NSW | 19/01/2024 | Remediation plan required following claims performance audit. |
One remediation plan was reported to SIRA as commencing this quarter following an insurer self-assessment of their obligations:
| Insurer | Date commenced | Matter |
|---|---|---|
| Westpac Banking Corporation | 13/03/2024 | In response to self-audit. |
The following remediation plans remained open:
| Insurer | Date commenced | Matter |
|---|---|---|
| Aldi Stores – A Limited Partnership | 24/02/2023 | In response to self-audit. |
| Australian Unity | 29/08/2023 | In response to self-audit. |
| BIC Services Pty Ltd | 11/09/2023 | In response to self-audit. |
| Canterbury Bankstown City Council | 30/11/2023 | In response to self-audit. |
| Catholic Churches Insurance | 01/10/2023 | In response to self-audit. |
| Comfort Delgro Corporation Australia Pty Ltd | 21/12/23 | In response to SIRA claims performance audit. |
| Commonwealth Steel Company Ltd | 14/12/2023 | In response to self-audit. |
| Fletchers International Exports Ltd | 20/12/2023 | In response to SIRA claims performance audit. |
| Hospitality Industry Insurance | 13/10/2023 | In response to self-audit. |
| Liberty | 16/11/2023 | In response to self- audit. |
| Liverpool City Council | 07/08/2023 | In response to self-audit. |
| NSW Trains | 02/03/2023 | In response to self-audit. |
| RGF Staffing APEG Pty Ltd | 22/12/2023 | In response to SIRA claims performance audit. |
| Sydney Trains | 02/03/2023 | To address issues in compliance, and case management. |
| The Star Entertainment Group | 19/09/2023 | In response to self-audit. |
| Toll Holdings | 01/12/2023 (updated 22/02/2024) | In response to self-audit and updated for SIRA claims performance audit. |
Claims performance audits
SIRA conducts claim performance audits under s202A of the Workers Compensation Act 1987 and in accordance with the requirements outlined in the SIRA Insurer audit tool and Insurer Claims Management Audit Guide. Audits measure performance across legislative compliance, case management practice and data quality. SIRA conducted 10 audits in the quarter on the following insurers:
- Brickworks Ltd
- Catholic Churches Insurance
- DAC Finance
- Food Investments (GWF)
- Holcim (Australia)
- Guild Insurance
- Commonwealth Steel Company Pty Ltd
- StateCover
- Aldi Stores
- icare (DXC).
Any regulatory action, such as a remediation plan, arising out of these audits will be reported on as part of this or future Regulatory Activity Quarterly Reports.
Security reviews
Under the Workers Compensation Act 1987 self-insurers and specialised insurers are required to provide financial security to ensure that other employers in NSW will not be required to meet the cost of claims if these entities are not able to meet their workers compensation liabilities.
Self-insurers must prepare and lodge a copy of their annual report (including audited financial statements) each fiscal year. SIRA reviews the annual report and financial statements and may increase, decrease or maintain the level of security.
Twenty-six insurer security reviews were completed and resulted in:
- seven maintained
- sixteen increased
- three decreased.
Regulation of employers
Employer insurance obligations
Proactive employer engagement about non-insurance
SIRA is proactively contacting employers that are highly likely to have employer insurance obligations but do not have a current workers compensation insurance policy.
Compliance letters were issued to 759 employers, which resulted in:
- 205 employers incepting a new policy
- 529 additional employees covered by a policy
- $341,793 in premium collected and invested back into the scheme.
Referrals for suspected non-compliance:
SIRA received the following employer insurance obligation referrals this period:
- 81 uninsured liability matters referrals from icare
- 73 under-insurance and 15 non-insurance matters from SafeWork NSW
- One under-insurance matter from other referral source.
Investigations leading to issuing notices
In the period, SIRA issued 75 Penalty Infringement Notices (PINs) and 60 Double Avoided Premium (DAP) notices to Revenue NSW for collection, totalling $92,250 and $2,058,059 respectively.
Uninsured Liability Scheme investigations, resulted in:
- 42 PINs, totalling $51,000
- 27 DAP notices, totalling $459,306.
Underinsurance investigations have detected:
- $67,024,175 in undeclared wages and referred an additional $2,207,979 in premiums to icare for collection, thereby insuring an additional 85 workers.
Non-insurance investigations, resulted in:
- 33 PINs, totalling $41,250
- 33 DAP notices, totalling $1,598,753.
Employer workplace injury management obligations
Predictive modelling of employers at risk of poor return to work performance is used to focus SIRA’s inspectorate activity. The inspectors have:
- Issued 1,300 letters to employers with workers at moderate risk of not returning to work.
- Engaged with 62 employers at a higher risk of poor return to work performance to promote and assess compliance with their workplace injury management obligations.
- Issued 81 employer improvement notices for failure to establish a return to work (RTW) program and/or failure to appoint a RTW coordinator.
- Issued 63 penalty notices for legislative breaches including:
- Failure to notify the insurer of a workplace injury within 48 hours.
- Failure to comply with improvement notices.
- Failure to have a register of injuries.
- Failure to display or notify a RTW program.
- Failure to establish a RTW program.
Fraud on workers compensation scheme
On 31 March 2024 there were 46 cases being triaged and investigated by SIRA. Fifteen new cases were referred this quarter.
Home building compensation scheme
One application for exemption was received and granted under section 97 of the Home Building Act 1989. Home Building Compensation exemptions can be accessed here. One application that was received in the previous quarter was granted in this quarter. From 1 June 2023, exemption applications that have been granted are published on SIRA’s HBC Insurance Exemption Register.
SIRA continues its state-wide insurance compliance audit targeting non-insured, residential building projects or projects where payments have been taken before home building insurance is in place. During this quarter, notices under Section 127 of the Home Building Act 1989 have been sent to 12 building businesses (bringing the cumulative total to 48 building businesses since the audit commenced).
During this quarter, 9 caution letters were issued to building businesses which the audit identified as having not complied with some insurance obligations under the Act. The audit will continue throughout 2024.
SIRA also conducted targeted checks for insurance compliance for a sample of 10 swimming pool building projects. This resulted in one caution letter being issued to a swimming pool building business that was identified as having not complied with some insurance obligations.
Regulation of healthcare providers
SIRA regulates health and rehabilitation providers to ensure the services delivered within the personal injury insurance schemes are in line with the legislation and conditions of the relevant approval framework.
Allied Health Practitioners
There are 12,460 practitioners approved to provide services in the workers compensation system. In this quarter SIRA has approved 653 practitioners and 103 practitioners had their approval revoked as they did not meet the eligibility requirements.
Health Practitioners Authorised to give evidence
There are 488 active health practitioners authorised to give evidence in the motor accidents scheme. In this quarter SIRA has appointed 30 new health practitioners.
Hearing Service Providers
There are 214 hearing service providers approved to deliver services in the workers compensation scheme. In this quarter SIRA has approved 4 hearing service providers.
Workplace rehabilitation providers
There are 104 workplace rehabilitation providers approved to deliver services in the workers compensation scheme.
Health Provider Supervision Assurance Program
The program focuses on SIRA approved allied health providers working in the schemes. SIRA monitors healthcare trends, performance, compliance and outcomes with scheme requirements. In a rolling program, SIRA will focus on health provider groups, including the below.
Accredited Exercise Physiologists
SIRA has completed further supervision activities on providers who were identified to be of risk during the 2023 supervision activity on accredited exercise physiologist’s billing practices in the workers compensation scheme. SIRA has sent letters of compliance to 11 practitioners with delayed payment billing practice. SIRA will consider further regulatory action in line with its regulatory framework.
Psychologists
SIRA conducted a review of payment data of psychologist billing practices in the workers compensation scheme for the 2022-2023 financial year, identifying potential anomalous billing practices, overservicing and excessive travel. SIRA has written letters of compliance to 48 psychologists. SIRA will consider further regulatory action in line with its regulatory framework.
Physiotherapists
SIRA completed a review of 5,284 physiotherapists against 10 compliance indicators for the 2022-2023 financial year. The focus of SIRA’s indicators included overservicing, complex services, average spend above peers, telehealth services compliance and report writing. SIRA has identified 43 physiotherapists with potential non-compliance. SIRA has issued letters of compliance to these providers and will consider further regulatory actions in line with its regulatory framework.
Significant matters reporting
From 1 March 2024 SIRA implemented new significant matters reporting requirements. The new requirements align all schemes and ensures significant matters are reported in a timely manner.