The Role of SelfInsurance in Australian Workers Compensation Schemes Alan Clayton Bracton Consulting

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The Role of Self-Insurance in Australian
Workers Compensation SchemesAlan
ClaytonBracton Consulting Services Pty Ltd
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What This Presentation is About

• Historical origins of self insurance
• Development of self insurance arrangements
• Alternative bases for access to self insurance
• Recent reviews
• Outline of a new regulatory structure for self
  insurance
• Future prospects

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Historical Origins

• English origins
• Australian mimesis
• Change from separate scheme to self insurance
  under common conditions

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Alternative Bases for Access to Self Insurance

• Self insurance not a pre-ordained feature of
  scheme design
• Self insurance as a right
• Self insurance as a privilege
• Self insurance as an integrated feature of scheme
  design

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Recent Reviews

• Victorian Issues Paper and Draft Report
• South Australian Issues Paper and Report

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Outline of a New Regulatory Structure for Self
Insurance

• Self insurance as an integrated feature of scheme
  design
• Partnership model
• Horizontal partnership
• Vertical partnership
• Recognition of different capacities,
  competencies, and levels of commitment
• Regulatory dynamic
• Natural consequences model
• Prudential issues

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Recognition of Difference


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Regulatory Dynamic


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Natural Consequences Model

• Self insurers determine their own destiny
• Differential supervisory regimes
• Initial path
• Future path
• Snakes and ladders approach
• No preordained guarantee of status

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Prudential Issues

• Size
• Nature of stipulated financial requirements
• Financial Guarantee
• Should there be a Guarantee Fund?
• If so, how large should it be?

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Future Prospects

• Self insurance as scheme bellwether
• mentoring
• impact on premium/levy
• Industry arrangements
• National issues