Insurers welcome Government paper

Insurers welcome Government paper | Insurance Business

Insurers welcome Government paper
The New South Wales Government has released a position paper on the sharing economy which has been welcomed by insurers as a way to better regulate the sharing economy.

The position paper outlines the Government stance on a wide range of aspects of the sharing economy, including services such as Airbnb and Uber, and notes that last year the sharing economy boosted the state economy by $504 million.

Minister for innovation and better regulation, Victor Dominello, said that the sharing economy will continue to grow in importance for the state.

“The economic benefits relating to the collaborative economy are already significant and will continue to grow, as more consumers choose to link or share directly with providers via online and mobile platforms,” Dominello said.

“Digital innovation is transforming the way people do business in every city and every country around the world. The reality is the collaborative economy is here to stay.

“We are living in the information age and it is vital that government policies embrace new technologies and enable businesses to operate with certainty.”

Ben Bessell, chief executive Australian Business Division for IAG, told Insurance Business that the very nature of the sharing economy demands a collaborative approach from Government, business and consumers.

“The sharing economy is rapidly evolving and we are supportive of more clarity around how this will be regulated in the future,” Bessell said.

“We believe the best response is for government, industry and community stakeholders to work together to identify how we can better protect Australians who choose to participate in the sharing economy and keep pace with their changing needs.”

Bessell noted that the advent of the sharing economy provides the insurance industry with great opportunities to further develop their customer offering.

“The sharing economy is a dynamic and innovative sector with huge potential to influence both the domestic and global economy,” Bessell continued.

“With an increasing number of Australians participating in the exchange of shared products and services, it is vital that there are clear boundaries in place to help protect both business owners and customers.

“For the insurance industry, this reinforces the importance of evolving our customer offering to include products and services tailored to customers participating in the sharing economy. We are working at a rapid pace to keep ahead of emerging digital trends and to continue to deliver first-to-market solutions for our customers.”

The Insurance Council of Australia (ICA), welcomed the Government paper as Rob Whelan, CEO of the ICA, spoke of the important role insurance will play in the future of the sharing economy.

“Insurers agree that sharing economy companies and those who operate them must have appropriate insurance policies to cover customer and third-party risk,” Whelan said.

“The ICA’s member companies are already responding to market demands by creating products to protect the thousands of new micro-business owners and operators, and their many customers.

“Initiatives like this one that seek to provide more certainty about the regulatory environment governing sharing economy businesses can help speed up that process.”

Whelan also stressed the tightrope that Government legislation has to walk as it balances new businesses with more traditional entities as he said the ICA remains committed to the principle competitive neutrality.

“The position paper states the importance of achieving the right balance of regulation so that innovation is not stifled. While recognising the extraordinary economic potential of these new digital business platforms, the ICA believes traditional business models are entitled to a level playing field so they’re not subject to regulations and compliance costs that digital startups can skirt,” Whelan said.

“The ICA and its member companies will continue to work with all levels of government as they seek to respond to the changing business environment.”

To read the full Government position paper, click here.