Issued: Friday, 18 March 2016
The NSW Law Reform Commission will review an old insurance law with the aim of removing uncertainty for insurers, the business community and consumers about the way the law operates today, Attorney General Gabrielle Upton announced.
Section 6 of the Law Reform (Miscellaneous Provisions) Act 1946 was introduced in 1946 to protect people where others attempted to escape their financial obligations.
70 years on, there are concerns the provision does not fit with modern insurance, particularly directors & officers insurance, and federal consumer laws.
"It's important we have laws in place that are easy to understand and provide maximum protection for consumers," Ms Upton said.
"However, the legislation is complex and its impact on insurance policies in unclear. Company directors, for example, need certainty about whether their insurance can fund their costs to defend a claim.
"This is why I have asked the Law Reform Commission to review the law to help work out whether it is still effective."
NSW, the Northern Territory and Australian Capital Territory are the only jurisdictions with this type of legislation in place. Every other state applies the federal insurance laws to protect consumers.
The review will give people an opportunity to provide feedback on how to improve the law or suggest what changes should be introduced.
The NSW Court of Appeal has suggested the law needs to be clearer, while the insurance industry has called on the NSW Government to scrap it.
For more details or to make a submission please contact: email@example.com.