Frequently Asked Questions
This section contains some of the most commonly asked questions about Comcover. They are divided into the following categories:
General Questions
GST
Insurance and Premiums
Exemptions from participation in Comcover
Proof of Insurance
Comcover and Comcare
Comcover Member Services
General Questions
What is Comcover?
Comcover is the Australian Government's general insurance fund. It is administered by a branch within the Department of Finance and Deregulation for the benefit of Fund Members. Comcover commenced operation on 1 July 1998.
Comcover's purpose is to work in partnership with Fund Members to promote a risk management culture and deliver an effective insurance program across the Australian Government.
A managed fund is a form of self-insurance that operates by collecting premiums from participating Fund Members and accumulating reserves in order to meet future losses from those reserves.
Why is a managed fund necessary?
A managed fund is a responsible, modern and cost-effective way for the Australian Government to manage its insurable risks. It consolidates resources through the systematic identification, quantification, reporting, and management of risk across Australian Government departments and agencies.
The Fund replaces the Australian Government's former policy of non-insurance, which offered little incentive for public sector organisations to manage their insurable risks effectively.
Who belongs to Comcover?
The Fund covers agencies within the Australian Government general government sector, including those covered by the Commonwealth Authorities and Companies Act 1997 and the Financial Management and Accountability Act 1997.
All organisations within the general government sector are required to belong to the Fund, unless they are specifically exempted. Exemption can only be granted by the Minister for Finance and Deregulation. This is done in consultation with the relevant Portfolio Minister, and only for compelling reasons. If an agency believes it has grounds for an exemption, its Portfolio Minister should write to the Minister for Finance and Deregulation.
Organisations that fall within the public trading enterprises sector or public financial enterprises sector are excluded from the Fund.
What does the Fund cover?
Comcover provides broad cover for all classes of general insurance normally available in the commercial insurance market. A major advantage of Comcover is that it provides broader coverage than the majority of private sector insurance policies, without many of the conditions and exclusions.
Cover is available for:
- damaged, lost or destroyed property;
- losses resulting directly from such property damage or loss. This can include losses associated with business interruption, relocations or the need to engage technical or other expertise; and
- legal liabilities of an insurable nature. These include the costs of judgments if a court finds an agency liable for a claim or for out-of-court settlements related to a claim and associated legal costs.
As with commercial insurance policies, the Fund provides for replacement or reinstatement of damaged or lost property but does not cover losses arising from guarantees or indemnities given by the Australian Government.
The Fund does not cover workers' compensation, which remains the responsibility of the Australian Government's Comcare program [
].
Unless otherwise agreed, liabilities arising from events that occurred before the introduction of Comcover will be met under the previous non-insurance arrangements.
What are the benefits of Comcover to the Australian Government as a whole?
In addition to benefits for individual agencies, Comcover provides improved risk management benefits to the Australian Government as a whole by:
- helping to protect the Budget and individual programs against unexpected insurable losses;
- achieving transparency and greater accountability in managing the Australian Government's insurable risks;
- reducing the cost of insurable losses to the Budget over time;
- reducing total costs to the Australian Government through pooling premiums and spreading risks;
- enabling the Australian Government to centrally accumulate risk knowledge and expertise;
- enabling better coordination and uniformity of approach to the litigation of claims against the Commonwealth; and
- providing a vehicle for accessing catastrophe insurance protection from the private sector.
What are the benefits of Comcover for Fund Member agencies?
Comcover offers substantial benefits, including:
- fewer exclusions and conditions than found in traditional insurance contracts;
- a short, simple but comprehensive policy document;
- more stable premiums for Fund Members;
- fair and equitable claims settlements;
- efficient and user-friendly claims management;
- efficient claims payments;
- maintenance of accurate claims records for each Fund Member;
- regular and prompt reports on claims results and trends;
- the full financial benefits of bulk buying;
- ongoing advice and assistance on ways to improve risk management practices; and
- convenient, one-stop shop service.
How do Fund Members find out more about general terms and conditions of cover?
The Comcover Insurance Policy is available on this website.
How are agencies kept up to date on Comcover?
From time to time Comcover also issues Information Bulletins to keep Fund Members updated on current issues.
What do I do if I have a dispute with Comcover or any of Comcover's Service Providers?
A dispute includes any disagreement relating to:
- acceptance of any claim by Comcover;
- settlement of any claim;
- payment of any premium to the Fund;
- the operation of the Fund; or
- any matter relating to the acts or omissions of Comcover or its service providers. Comcover is committed to the efficient and fair resolution of all complaints.
If a Fund Members is not happy with the services provided, they should contact Comcover Member Services in the first instance.
The Comcover Insurance Policy lists the procedure for dispute resolution with regard to claims and premiums. A summary is provided below.
Dispute resolution - Claims
A dispute includes disagreements about acceptance or settlement of a claim subject to the claims settlement condition. If a Fund Member has a dispute with Comcover Member Services, the Fund Member should contact Comcover Member Services in the first instance. If the Fund Member's concerns are not satisfied through their approach to Comcover Member Services, the following steps may be taken:
- The Fund Member must inform Comcover if the dispute lasts for more than 30 days.
- If the matter cannot be resolved within a further 30 day period, the matter must be referred to a mutually agreed mediator.
If a Fund Member has a dispute with Comcover, the Fund Member should contact the Comcover Manager in the first instance. If the Fund Member's concerns are not satisfied through their approach to Comcover, the following steps may be taken:
- If the matter cannot be resolved within 60 days, the matter must be referred to a mutually agreed mediator.
- If the matter cannot be resolved through mediation, it will be referred to the Secretary of the Department of Finance and Deregulation and the Chief Executive (or their nominees) of the Fund Member organisation.
- If the dispute cannot then be resolved, the matter will be referred to the relevant Ministers.
Dispute resolution - Premiums
A dispute includes a failure by a Fund Member to pay any premium. If the Fund Member has a dispute regarding their premium, the Fund Member should contact the Comcover Manager in the first instance to attempt resolution. If the Fund Member’s concerns are not satisfied, the following steps may be taken:
- If the dispute cannot then be resolved, the matter may be referred to the Secretary of the Department of Finance and Deregulation and the Chief Executive Officer (or their nominees) of the Fund Member organisation.
- If the dispute cannot be resolved, the matter may be referred to the relevant Ministers.
GST
Are Comcover Fund Members subject to GST?
Yes, all Australian Government agencies must pay GST and collect GST for any goods or services provided. The GST legislation states that agencies covered by the Commonwealth Authorities and Companies Act 1997 and the Financial Management and Accountability Act 1997 must pay GST (section 177-1).
How do Fund Members work out their entitlement to input tax credits on insurance premiums?
Comcover recommends that agencies seek professional advice when calculating their entitlement to claim input tax credits.
What is the impact of GST on Comcover insurance settlements?
GST is taken into account when calculating the amount to be paid in settlement of claims.
It is important that agencies notify Comcover of the extent of their entitlement to claim input tax credits before cover begins, so that claims can be processed efficiently.
Insurance and Premiums
Who is the underwriter for Comcover?
The Australian Government, through Comcover, is the underwriter of the Fund. As Comcover is not a separate legal entity but a part of the Commonwealth, a liability of Comcover is a liability of the Australian Government Budget.
How will Comcover keep the cost of insurance down?
The history of public and private sector funds similar to Comcover shows that significant savings are achieved over time. This will be possible with Comcover because the Australian Government is pooling large groups of risks. There are less infrastructure costs (commissions, capital, overheads etc), less need for the Australian Government as a whole to buy external insurance, and benefits from economies of scale in dealing with providers on a whole-of-government basis. Comcover provides more stable premiums that, over time are lower than the long-term cost of commercial insurance premiums.
Can Fund Members influence the amount of their premiums?
Yes, Fund Members receive premium discounts if they demonstrate good risk management practices and good claims histories. This is consistent with sound commercial insurance practice and underwriting principles. On the other hand, Fund Members are charged higher premiums if they have poor risk management practices and poor claims histories. The annual Benchmarking Survey and Awards for Excellence are useful tools to compare and enhance current practices. Both may also lead to further discounts for Fund Members upon completion.
Do premiums reflect the individual circumstances of each Fund Member or are they community rated to the aggregate risk profile of the whole pool?
Primarily, premiums reflect the circumstances and claims history of each Fund Member. Fund Member premiums are set, where possible, on the past experience of the Fund Member and an assessment of the current level of risk (taking into account the Fund Member's actions to improve its risk exposure). However, a key benefit of a fund is that there is some balance made to allow consistency in premiums and spread short-term costs, which helps to alleviate the pressure experienced with exceptional, one-off large losses.
Why does Comcover accumulate reserves?
Comcover follows conventional insurance practice and quarantines all losses for a particular year against the premiums received for that year. Therefore, each year Comcover needs to set aside an amount (reserves) to meet anticipated liabilities arising from claims for that year (please note that claims, particularly in the liability classes of insurance, may take a number of years to settle).
The level of reserves required to meet outstanding liabilities remains a matter for periodic actuarial estimation until claims are actually settled. Comcover will use any accumulated surplus reserves to reduce future Fund Member premiums.
Will Comcover meet Fund Members' pre-fund liabilities?
Unless otherwise agreed, liabilities arising from events that occurred before the introduction of Comcover will be met under the previous non-insurance arrangements.
Comcover pre-fund exposures of Fund Members covered by the Financial Management and Accountability Act 1997 would be met by the Australian Government Budget and not be paid from Comcover Fund reserves.
Is Comcover providing run-off cover for commercial policies as they lapse?
Yes. Comcover offers "claims-made" policies to replace existing policies of agencies covered by the Commonwealth Authorities and Companies Act 1997 where these are required.
If a Fund Member provides a number of third party indemnities, in particular, to contractors performing work for the Fund Member, does Comcover take over these indemnities?
For the most part, the answer is no - Comcover underwrites only normally insurable risks. Indemnities are exposures voluntarily entered into by an agency and are not usually insurable in the commercial insurance market because, among other things, they may remove incentives to exercise a duty of care.
However, any indemnities in place as alternatives to commercial insurance arrangements may be considered by Comcover on a case-by-case basis, but only after completion of a risk assessment and Fund Member acceptance of the additional exposure.
For further information about issuing indemnities, see Guidelines for Issuing and Managing Indemnities, Guarantees, Warranties and Letters of Comfort, September 2003 [
174 KB] and Comcover Coverage of Contract Indemnities [ 173 KB].
Exemptions from participation in Comcover
Can agencies seek exemption from participating in Comcover?
The Government's decision to establish Comcover states that all Australian Government agencies in the general government sector are required to participate in the Fund.
However, the Government's decision also provides for the Minister for Finance and Deregulation to consider submissions from Portfolio Ministers where there are compelling reasons for an exemption.
Proof of Insurance
How do Fund Members provide external parties with proof of insurance?
Comcover Member Services can provide Fund Member insurance contacts with generic Certificates of Currency which act as proof of insurance under the Comcover Fund. If you have a specific requirement please contact your agency's primary insurance contact in the first instance or alternatively Comcover Member Services on 1800 651 540.
Comcover and Comcare
What is the relationship between Comcover and Comcare?
The establishment of Comcover has not affected Comcare's role as the Australian Government's workers' compensation insurer and Comcare [] continues to cover workers' compensation insurance.
Comcover Member Services
Who are Comcover Member Services?
Comcover Member Services (CMS) is responsible for delivering a range of services to Comcover's Fund Members. CMS is your single point of contact for all insurance, claims, risk management, CMS Portal, training and event related enquiries.
How do I tell Comcover Member Services about a new staff member?
If you have a new staff member who either needs access to the CMS Portal or to be included on our mailing list for course and event information, please call 1800 651 540.
How do I contact Comcover Member Services?
See Comcover Member Services contact details.
Contact for information on this page: Contact Comcover Member Services