Question regarding revenue increases from Home Indemnity Insurance (HII), premium increases, and the tendering process for the HII contract extension. The answer clarifies revenue sources, confirms no premium increases, and explains why the contract extension wasn't tendered.

AnsweredQoN 4748Legislative Assembly
Asked
13 February 2019
Portfolio
Treasurer

QuestionView source ↗

I refer to page 110 of the Mid Year Review and I ask: (a) What is the expected revenue increases from home indemnity insurance for each of the following years: (i) 2018-19; (ii) 2019-20; (iii) 2020-21; and (iv) 2021-22; (b) Do these revenue increases include increases to premiums and if so, what is the forecast premium increases (in both percentage and dollars) for each of the following years: (i) 2018-19; (ii) 2019-20; (iii) 2020-21; and (iv) 2021-22; and (c) Did the extension of the contract go to tender? If not, why not?

AnswerView source ↗

Answered
12 March 2019
Response time
5 days
(a) The expected revenue increases from Home Indemnity Insurance (HII) are a combination of its two-year extension to 30 June 2020 (there was no revenue until the scheme was extended) and a projected increase in activity. (i) $3.0 million (ii) $21.4 million (iii) $14.3 million (iv) $2.9 million
(b) No changes to HII premiums were implemented. (i-iv) Not applicable.
(c) No. The Department of Mines, Industry Regulation and Safety is responsible for managing HII arrangements in Western Australia (under which the insurer requires 100% reinsurance from the State Government to underwrite and manage HII claims). Previous attempts to solicit interest from other private sector providers have been unsuccessful. As a result, an option with the existing provider was exercised.

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