Workers Compensation Amendment Regulation 2022 (No 1) (ACT)
Workers Compensation Amendment Regulation 2022 (No 1)
Subordinate Law SL2022-4
The Australian Capital Territory Executive makes the following regulation under the Workers Compensation Act 1951.
Dated 31 March 2022.
Andrew Barr
Chief Minister
Mick Gentleman
Minister
Workers Compensation Amendment Regulation 2022 (No 1)
Subordinate Law SL2022-4
made under the
Workers Compensation Act 1951
Contents
Page
1 Name of regulation 1
2 Commencement 1
3 Legislation amended 1
4 Section 3, note 1 1
5 Division 9.1 2
6 Divisions 9.2 and 9.3 3
7 Division 10.1 12
8 Divisions 10.2 and 10.3 15
9 Section 95A heading 21
10 Section 95A (1) (a) and (b), except note 21
11 Section 95A (2), note 21
12 Section 95A (3) 21
13 Section 95B heading 22
14 Section 95B (1) (a) and (b) 22
15 Section 95B (2), note 22
16 Section 95B (3) 22
17 Section 95C 23
18 Section 101 heading 23
19 Section 101 (2) (b) and (c) 23
20 Dictionary, note 2 24
21 Dictionary, note 3 24
22 Dictionary, new definition of audit 24
23 Dictionary, definitions 25
Name of regulation
This regulation is the Workers Compensation Amendment Regulation 2022 (No 1).
Commencement
(1)This regulation (other than the following provisions) commences on the day after its notification day:
· section 6
· section 8
· section 11
· section 15.
NoteThe naming and commencement provisions automatically commence on the notification day (see Legislation Act, s 75 (1)).
(2)The provisions mentioned in subsection (1) commence on 1 June 2022.
Legislation amended
This regulation amends the Workers Compensation Regulation 2002.
Section 3, note 1
substitute
Note 1The dictionary at the end of this regulation defines certain terms used in this regulation, and includes references (signpost definitions) to other terms defined elsewhere in this regulation.
For example, the signpost definition ‘clinically relevant research—see section 6.’ means that the term ‘clinically relevant research’ is defined in section 6.
Division 9.1
substitute
Division 9.1 Licensing of licensed insurers
Application for insurer licence—Act, s 145J (a)
(1)An application for an insurer licence by an insurer (the applicant) must—
(a)include evidence of an authorisation under the Insurance Act 1973 (Cwlth), section 12 to carry on an insurance business in Australia; and
(b)if the applicant is applying for a corresponding licence—include evidence of the application; and
(c)if the applicant has a corresponding licence—include evidence of the licence and any conditions on the licence; and
(d)include evidence that the applicant has adequate reinsurance, or other arrangements in place, to cover the applicant’s future liability under the Act; and
(e)comply with any protocol relating to applying for a licence.
(2)The regulator may, in writing, require further evidence from an applicant that demonstrates the applicant—
(a)is financially and prudentially sound; or
(b)will be able to meet any obligations as an insurer under the Act in relation to injury management programs and personal injury plans.
(3)In this section:
corresponding licence means a licence under a State law that has the same effect, or substantially the same effect, as an insurer licence.
Criteria for issuing insurer licence—Act, s 145J (b)
The regulator may issue an insurer licence only if satisfied the applicant for the licence—
(a)is financially and prudentially sound; and
(b)if licensed, will—
(i)be able to meet the applicant’s existing and expected liabilities under the Act; and
(ii)be able to meet the applicant’s obligations as an insurer under the Act; and
(iii)comply with any conditions on the licence.
Particulars of insurer licence—Act, s 145J (b)
An insurer licence must state the following:
(a)the insurer’s name;
(b)if the insurer operates the insurance service under another name—the insurer’s other name;
(c)the insurer’s ABN or ACN.
Divisions 9.2 and 9.3
substitute
Division 9.2 Conditions on insurers
Insurer must have reinsurance—Act, s 145J (c)
It is a condition of an insurer licence that the insurer maintain reinsurance that is capable of meeting the insurer’s existing and expected liabilities under the Act.
Information about ability to meet liabilities etc—Act, s 145J (c) and (g)
(1)It is a condition of an insurer licence that the insurer give the regulator the following information, if requested in writing by the regulator:
(a)information about claims that have been made against the insurer under the Act;
(b)information to allow the regulator to assess—
(i)the insurer’s continuing ability to meet the insurer’s existing and expected liabilities under the Act; and
(ii)whether the insurer continues to be financially and prudentially sound; and
(iii)the insurer’s continuing ability to meet its obligations under the Act.
(2)Information requested from an insurer in writing by the regulator must be reasonably necessary for the performance of the regulator’s functions.
Insurer to provide information and pay costs of audit—Act, s 145J (c) and (f)
It is a condition of an insurer licence that for an audit under part 10A, the insurer—
(a)complies with the reasonable requirements of the person conducting the audit; and
(b)allows the person conducting the audit access to the information reasonably required to conduct the audit; and
(c)pays reasonable fees and reasonable expenses for the audit.
NoteThe Minister may approve a protocol about how a person who is subject to an audit must participate in the audit (see s 101 (2) (b)).
Information on working out premiums—Act, s 145J (c) and (e)
(1)It is a condition of an insurer licence that—
(a)on written request by the regulator, the insurer gives the regulator, in writing, any relevant information about how the insurer works out premiums for compulsory insurance policies; and
(b)the insurer must give information under paragraph (a) within the period stated in the request that is not less than 21 days after the day the regulator asked for the information.
(2)In this section:
relevant information means information the regulator is satisfied on reasonable grounds will help the regulator to decide whether premiums are being worked out in accordance with the principles for working out premiums under section 75.
Principles for working out premiums—Act, s 145J (c)
(1)It is a condition of an insurer licence that, in working out premiums, an insurer must—
(a)provide for sufficient (but not excessive) income from premiums to fully fund liabilities arising from policies of insurance to which the premiums relate; and
(b)ensure that premiums are structured to minimise, as far as reasonably practicable, the cross subsidisation of premium rating groups.
(2)For this section, there is sufficient income from premiums to fully fund the liabilities to which the premiums relate if the premiums are sufficient to do all of the following:
(a)fully fund claims liabilities arising from the insurance policies to which the premiums relate;
(b)pay all acquisition, policy administration and claims settlement expenses of the insurer;
(c)provide a profit margin after the payment of claims, costs and expenses that represents an adequate return on capital invested and compensation for the risk taken;
(d)provide for anything else that a prudent insurer should, in the circumstances, provide for;
(e)provide for contributions or other charges payable by the insurer under the Act.
(3)For subsection (2) (a), the amount of claims liabilities of the insurer does not include the treatment, care and support costs of a participant in the LTCS scheme.
NoteLTCS scheme—see the LTCS Act, dictionary.
(4)An insurer is taken to have complied with subsection (1) (a) if the insurer provides for sufficient (but not excessive) income from premiums in accordance with actuarial advice about the liability arising from policies of insurance to which the premiums relate.
Time for information to be given—Act, s 145J (c) and (g)
(1)It is a condition of an insurer licence that any information required to be given to the regulator is given—
(a)within 14 days after the day the information is requested; or
(b)if a longer period is allowed by the regulator or provided for the giving of the information—within that period.
(2)This section does not apply to section 74 (Information on working out premiums—Act, s 145J (c) and (e)).
Record keeping by licensed insurers—Act, s 145J (d)
(1)It is a condition of an insurer licence that a licensed insurer must keep records about the licensed insurer’s policies, processes and decisions for the provision of an insurer service, in accordance with any protocol relating to the keeping of records.
(2)A record mentioned in subsection (1) must be kept for not less than 5 years after the day the record is made.
Action if rehabilitation provider’s approval suspended or revoked—Act, s 145J (c)
It is a condition of an insurer licence that the insurer must arrange for another rehabilitation provider to be responsible for a worker’s vocational rehabilitation under a personal injury plan if—
(a)the approval of the rehabilitation provider responsible for the worker’s rehabilitation under the plan has been suspended or revoked; and
(b)the insurer is responsible for the personal injury plan for the worker.
Division 9.3 Action against insurers
Notice of proposed action against licensed insurer
If the regulator proposes to take action (the proposed action) mentioned in section 80 (2) in relation to an insurer, or to cancel the insurer licence, the regulator must give the insurer written notice—
(a)stating the proposed action; and
(b)stating the grounds for the proposed action; and
(c)inviting the insurer to make written representations, within a stated period of not less than 14 days after the day the insurer is given the notice, about why the proposed action should not be taken.
Action other than cancellation of insurer licence—Act, s 223 (2) (h)
(1)This section applies to a licensed insurer if—
(a)the insurer—
(i)contravenes the Act, section 112 (Compliance by insurers, including DI fund) or another provision of the Act; or
(ii)is unable to meet the insurer’s existing and expected liabilities under the Act; or
(iii)no longer has unlimited reinsurance for a single event to cover the insurer’s expected liability under the Act; or
(iv)fails to comply with a condition on the insurer licence; and
(b)the regulator has given the insurer notice under section 79.
(2)After considering any written representations made by the insurer within the period for representations stated in the notice, the regulator may—
(a)do 1 or more of the following:
(i)order the insurer to pay to the Territory a financial penalty of not more than $1 000;
(ii)impose a condition on the insurer licence of the insurer (for example, by including a condition providing for increased supervision of the insurer by the regulator);
(iii)censure the insurer;
(iv)order the insurer to take remedial action; or
(b)suspend the licence for not longer than the period.
(3)The regulator must tell the insurer in writing about the decision—
(a)if the decision is to take action other than suspension—by giving the insurer a reviewable decision notice; or
NoteThe requirements for reviewable decision notices are prescribed under the ACT Civil and Administrative Tribunal Act 2008.
(b)if the decision is to suspend the insurer licence—in accordance with section 82 (Effect of regulator suspension or cancellation of insurer licence—Act, s 145J (h)).
(4)In this section:
proposed action—see section 79.
Cancellation of insurer licence—Act, s 145J (h)
(1)This section applies to an insurer licence if—
(a)a matter mentioned in section 80 (1) (a) applies to the insurer; and
(b)either—
(i)the regulator has taken action under section 80 (2), but the matter continues or is repeated; or
(ii)the regulator considers immediate action is required because of a serious circumstance; and
(c)the regulator gives notice under section 79 that the regulator proposes to cancel the licence.
(2)After considering any written representation made by the insurer within the period for representations stated in the notice, the regulator may—
(a)take action under section 80 (2); or
(b)cancel the insurer licence.
(3)For subsection (1) (b) (ii), a serious circumstance includes a circumstance in which the insurer—
(a)fails to establish an injury management program under the Act, section 88 (Insurer to establish etc injury management program); or
(b)fails to give effect to an injury management program under the Act, section 89 (Insurer to give effect to injury management program); or
(c)fails to establish a personal injury plan for an injured worker under the Act, section 97 (Personal injury plan for worker with significant injury); or
(d)contravenes a direction under the Act, section 114 (Unreasonableness in stopping payment); or
(e)fails to comply with the regulator’s notice, or gives details that are false or misleading in a material respect, under the Act, section 164 (Provision of information to Minister).
(4)The regulator must tell the insurer, in writing, about the decision—
(a)if the decision is to take action other than suspension or cancellation—by giving the insurer a reviewable decision notice; or
NoteThe requirements for reviewable decision notices are prescribed under the ACT Civil and Administrative Tribunal Act 2008.
(b)if the decision is to suspend or cancel the insurer licence—in accordance with section 82.
Effect of regulator suspension or cancellation of insurer licence—Act, s 145J (h)
(1)If the regulator decides to suspend or cancel an insurer licence, the regulator must give written notice of the decision, including when the suspension or cancellation takes effect, to the insurer who holds the licence.
NoteThe regulator’s notice must comply with the requirements of the Act, s 199A.
(2)A suspension or cancellation must not take effect earlier than 7 days after the day the insurer is told about the decision.
(3)Subject to the Act, section 146 (Effect of cancellation or suspension of insurer licence), if the regulator suspends an insurer licence, the insurer is, during the suspension—
(a)taken not to be a licensed insurer; and
(b)disqualified from applying for a licence as an insurer.
(4)The regulator may, at any time, by written notice to the insurer, end or reduce the period of suspension of the insurer licence.
When does cancellation make previous insurance policies not compulsory insurance policies?—Act, s 146 (3)
(1)If an insurer licence is cancelled, a compulsory insurance policy issued before the cancellation is taken not to be a compulsory insurance policy only if a reason for the cancellation is the winding‑up of the insurer.
(2)The compulsory insurance policy stops being a compulsory insurance policy 7 days after the day the cancellation takes effect.
Division 10.1
substitute
Division 10.1 Issue of self-insurer licence by regulator
84AApplication for self-insurer licence—Act, s 145U (a)
(1)An application for a self‑insurer licence by an employer (the applicant) must contain or be accompanied by the following:
(a)if the applicant is applying for a corresponding self‑insurer licence—include evidence of the application;
(b)if the applicant has a corresponding self‑insurer licence—include evidence of the self-insurer licence and any conditions on the licence;
(c)evidence that the applicant has unlimited reinsurance for a single event to cover the applicant’s existing and expected liability under the Act;
(d)a copy of the applicant ’s audited financial statements (or, if it is not available, equivalent information) for each of the previous 3 years;
(e)an actuarial report in accordance with subsection (3);
(f)a guarantee from an authorised deposit-taking institution in favour of the DI fund for the guaranteed amount in a form that complies with any protocol relating to applying for a licence;
NoteThe guaranteed amount is defined in s (4).
(g)evidence that the applicant has in place an occupational health and safety management system that complies with any Australian or New Zealand standards in relation to safety mentioned in a protocol relating to applying for a licence;
(h)any other information or evidence mentioned in a protocol relating to applying for a licence.
(2)The regulator may, in writing, require further evidence from an applicant that demonstrates the applicant—
(a)is financially and prudentially sound; or
(b)will be able to meet any obligations as an insurer under the Act in relation to injury management programs and personal injury plans.
(3)For subsection (1) (e), the actuarial report must contain an estimate of the following information as if the applicant were a licensed self‑insurer at the time of the application:
(a)the applicant’s existing outstanding liability in relation to compensable injuries;
(b)the applicant’s expected liability each year for the 2-year period beginning on the day the applicant applies for the licence;
(c)the total expected payments in satisfaction of the applicant’s liability for compensable injuries likely to be made each year for the 2-year period beginning on the day the applicant applies for the licence.
(4)For subsection (1) (f), the guaranteed amount is the greater of—
(a)$1 000 000; and
(b)an amount calculated by an actuary to be the estimate of outstanding claims liability at the balance date, plus a prudential margin of 50%.
(5)In this section:
corresponding self-insurer licence means a self-insurer licence under a State law that has the same effect, or substantially the same effect, as a self-insurer licence under the Act.
84BCriteria for issuing self-insurer licence—Act, s 145U (b)
The regulator may issue a self-insurer licence to the applicant only if satisfied—
(a)the applicant for the licence—
(i)is financially and prudentially sound; and
(ii)if licensed, will—
(A)be able to meet the applicant’s existing and expected liabilities as a self-insurer under the Act; and
(B)be able to meet the applicant’s obligations as a self‑insurer under the Act in relation to injury management programs and personal injury plans; and
(C)be able to comply with the applicant’s health and safety duties under the Work Health and Safety Act 2011; and
(D)comply with the conditions on the self-insurer licence; and
(b)the issue of the self-insurer licence will not adversely affect the operation of the workers compensation scheme under the Act.
Divisions 10.2 and 10.3
substitute
Division 10.2 Self-insurer licence conditions
Licensed self-insurer to have reinsurance—Act, s 145U (c)
It is a condition of a self-insurer licence that the employer maintain unlimited reinsurance for a single event to cover the self-insurer’s existing and expected liability under the Act.
Information about workers compensation, vocational rehabilitation and occupational health and safety—Act, s 145U (c)
(1)It is a condition of a self-insurer licence that the employer give the regulator information, requested in writing by the regulator, about workers compensation, vocational rehabilitation and occupational health and safety related to the employer.
(2)Information requested from a self-insurer in writing by the regulator must be reasonably necessary to allow the regulator to assess the employer’s continuing suitability to be a licensed self‑insurer.
Record keeping by licensed self-insurers—Act, s 145U (d)
(1)It is a condition of a self-insurer licence that the employer must keep records about the employer’s policies, processes and decisions for the provision of an insurer service, in accordance with any protocol relating to the keeping of records.
(2)A record mentioned in subsection (1) must be kept for not less than 5 years after the day the record is made.
Action if rehabilitation provider’s approval suspended or revoked—Act, s 145U (c)
It is a condition of a self-insurer licence that the employer must arrange for another rehabilitation provider to be responsible for a worker’s vocational rehabilitation under a personal injury plan if—
(a)the approval of the rehabilitation provider responsible for the worker’s rehabilitation under the plan has been suspended or revoked; and
(b)the employer is responsible for the personal injury plan for the worker.
Self-insurer to provide information and pay costs of audit—Act, s 145U (c) and (f)
It is a condition of a self-insurer licence that the self-insurer, for an audit under part 10A—
(a)complies with the reasonable requirements of the person conducting the audit; and
(b)allows the person conducting the audit access to the information reasonably required to conduct the audit; and
(c)pays reasonable fees and reasonable expenses for the audit.
NoteThe Minister may approve a protocol about how a person who is subject to an audit must participate in the audit (see s 101 (2) (b)).
Self-insurer to maintain bank guarantee—Act, s 145U (c)
It is a condition of a self-insurer licence that the employer maintain a bank guarantee in accordance with section 84A (1) (f).
Self-insurer to maintain occupational health and safety management system—Act, s 145U (c)
It is a condition of a self-insurer licence that the employer maintain an occupational health and safety management system that complies with an Australian/New Zealand Standard on occupational health and safety referred to in a protocol relating to applying for a licence.
Division 10.3 Action against licensed self-insurers
Notice of proposed action against licensed self-insurer
(1)Before taking proposed action in relation to a self‑insurer, the regulator must give the licensed self-insurer written notice in accordance with subsection (2).
(2)Written notice to a self-insurer must state the following:
(a)the proposed action;
(b)the grounds for the proposed action;
(c)the self-insurer may make written representations, within a stated period of not less than 14 days after the day the self‑insurer is given the notice, about why the proposed action should not be taken.
(3)In this section:
proposed action means—
(a)action under section 93 (2); or
(b)action to cancel a self-insurer licence under section 95.
Action other than cancellation of self-insurer licence—Act, s 223 (2) (h)
(1)This section applies to a self-insurer if—
(a)the self-insurer—
(i)contravenes the Act, section 112 (Compliance by insurers, including DI fund) or another provision of the Act; or
(ii)is unable to meet the self-insurer’s existing and expected liabilities under the Act; or
(iii)no longer has unlimited reinsurance for a single event to cover the self-insurer’s expected liability under the Act; or
(iv)does not have the guarantee from an authorised deposit‑taking institution mentioned in section 84A (1) (f); or
(v)fails to comply with a condition on the self-insurer licence; and
(b)the regulator has given the self-insurer notice under section 92.
(2)After considering any written representation made by the licensed self‑insurer within the period for representations stated in the notice, the regulator may—
(a)do 1 or more of the following:
(i)order the licensed self-insurer to pay to the Territory a financial penalty of not more than $1 000;
(ii)impose a condition on the self-insurer licence (for example, by including of a condition providing for increased supervision of the licensed self-insurer by the regulator);
(iii)censure the self-insurer;
(iv)order the self-insurer to take remedial action; or
(b)suspend the self-insurer licence for not longer than the period.
(3)The regulator must tell the licensed self-insurer, in writing, about the decision—
(a)if the decision is to take action other than suspension—by giving the licensed self-insurer a reviewable decision notice; or
NoteThe requirements for reviewable decision notices are prescribed under the ACT Civil and Administrative Tribunal Act 2008.
(b)if the decision is to suspend the self‑insurer’s self-insurer licence—in accordance with section 95.
Cancellation of self-insurer licence—Act, s 145U (g)
(1)This section applies to a licensed self-insurer if—
(a)a matter mentioned in section 93 (1) (a) applies to the self‑insurer; and
(b)the regulator has taken action under section 93 (2), but the matter continues or is repeated; and
(c)the regulator gives notice under section 92 that the regulator proposes to cancel the self-insurer licence.
(2)After considering any written representation made by the licensed self‑insurer within the period for representations stated in the notice, the regulator may—
(a)do 1 or more of the things mentioned in section 93 (2); or
(b)cancel the self-insurer licence.
(3)The regulator must tell the self-insurer, in writing, about the decision—
(a)if the decision is to take action other than suspension or cancellation—by giving the self-insurer a reviewable decision notice; or
NoteThe requirements for reviewable decision notices are prescribed under the ACT Civil and Administrative Tribunal Act 2008.
(b)if the decision is to suspend or cancel the self-insurer licence—in accordance with section 95.
Cancellation or suspension of self‑insurer licence by regulator—Act, s 145U (g)
(1)If the regulator decides to suspend or cancel a self-insurer’s self‑insurer licence the regulator must give written notice of the decision to the self‑insurer, including when the suspension or cancellation takes effect.
NoteThe regulator’s notice must comply with the requirements of the Act, s 199A.
(2)A suspension or cancellation must not take effect earlier than 7 days after the day the self-insurer is told about the decision.
(3)If the regulator suspends a self-insurer licence, the self-insurer is, during the suspension—
(a)taken not to be a licensed self-insurer; and
(b)disqualified from applying for another self-insurer licence.
(4)The regulator may, at any time, by written notice to the self‑insurer, end or reduce the period of suspension of the self‑insurer licence.
Section 95A heading
substitute
95ACompliance audits—Act, s 145J (d) and (f) and s 145U (d) and (e)
Section 95A (1) (a) and (b), except note
substitute
(a)a licensed insurer; or
(b)a licensed self-insurer.
Section 95A (2), note
substitute
NoteThe person audited must comply with the requirements of the person conducting the audit (see s 73 and s 89).
Section 95A (3)
substitute
(3)In this section:
compliance audit means an audit of—
(a)compliance with the Act and this regulation; and
(b)for a licensed insurer—compliance with the conditions, under division 9.2, of a licence; and
(c)for a self-insurer—compliance with the conditions, under division 10.2, of a self‑insurer licence; and
(d)compliance with a relevant protocol approved under section 101.
compliance auditor means a person appointed under section 95C to conduct a compliance audit.
Section 95B heading
substitute
95BFinancial audits—Act, s 145J (d) and (f) and s 145U (d) and (e)
Section 95B (1) (a) and (b)
substitute
(a)a licensed insurer; or
(b)a licensed self-insurer.
NoteA fee may be determined under the Act, s 221 for this provision.
Section 95B (2), note
substitute
NoteThe person audited must comply with the requirements of the person conducting the audit (see s 73 and s 89).
Section 95B (3)
substitute
(3)In this section:
financial audit means an audit of—
(a)financial and prudential soundness; and
(b)the ability to meet existing and expected liabilities under the Act.
financial auditor means a person appointed under section 95C to conduct a financial audit.
Section 95C
substitute
95CAppointment of auditors
(1)The regulator may—
(a)appoint a suitably qualified person as a compliance auditor to conduct compliance audits under section 95A; and
(b)appoint an auditor as a financial auditor to conduct financial audits under section 95B.
(2)A person appointed under subsection (1) must be appointed for not longer than 3 years.
NoteFor laws about appointments, see the Legislation Act, pt 19.3.
Section 101 heading
substitute
Approved protocols for licensed insurers and licensed self-insurers—Act, s 223 (2) (k)
Section 101 (2) (b) and (c)
substitute
(b)how a person subject to an audit under part 10A must participate in the audit; and
Dictionary, note 2
insert
· ACT
· contravene
· fail
· penalty unit (see s 133)
· reviewable decision notice
Dictionary, note 3
insert
· asbestos-related disease
· compensable injury
· compensation
· cpi indexed (see s 20)
· DI fund manager
· disease
· imminently fatal asbestos-related disease
· injury management
· injury management plan
· nominated treating doctor
· personal injury plan (see s 85A)
· protocol
Dictionary, new definition of audit
insert
audit, under part 10A, means—
(a)a compliance audit conducted under section 95A; or
(b)a financial audit conducted under section 95B.
Dictionary, definitions
omit the definitions of
injury management
injury management plan
nominated treating doctor
personal injury plan
protocol
Endnotes
Notification
Notified under the Legislation Act on 31 March 2022.
Republications of amended laws
For the latest republication of amended laws, see align="center">© Australian Capital Territory 2022
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