Commonwealth Coat of Arms

Assistant Treasurer to Australian Reinsurance Pool Corporation (Premiums) Directions 20111

Terrorism Insurance Act 2003

I, BILL SHORTEN, Assistant Treasurer, give these Directions under subsection 38 (1) of the Terrorism Insurance Act 2003.

Dated 28 June 2011

 

BILL SHORTEN

Assistant Treasurer

Contents

 1 Name of Directions 

 2 Commencement 

 3 Repeal 

 4 Definitions 

 5 Working out premium income if subclause 6 (2) does not apply 

 6 Working out premium income for certain eligible insurance contracts 

 7 New Tier B postcodes 

 8 New Tier C postcodes 

 9 Corporation must charge premium in accordance with specified rates 

Schedule 1 Tier A, B and C Postcodes 

Part 1 Tier A Postcodes 

Part 2 Tier B Postcodes 

Part 3 Tier C Postcodes 

 

1 Name of Directions

  These Directions are the Assistant Treasurer to Australian Reinsurance Pool Corporation (Premiums) Directions 2011.

2 Commencement

  These Directions commence on 1 July 2011.

3 Repeal

  The Treasurer to Australian Reinsurance Pool Corporation (Premiums) Direction 2007 is repealed.

4 Definitions

  In these Directions:

Act means the Terrorism Insurance Act 2003.

Australia Post has the meaning given by the Australian Postal Corporation Act 1989.

GST has the meaning given by the A New Tax System (Goods and Services Tax) Act 1999.

premium income:

 (a) for an eligible insurance contract to which subclause 6 (2) does not apply means the amount worked out for the contract in accordance with subclause 5 (1); and

 (b) for an eligible insurance contract to which subclause 6 (2) applies — means the amount worked out for the contract in accordance with subclause 6 (2).

population centre means an area in Australia that has:

 (a) a population of more than 100 000 people; and

 (b) a Tier A postcode or a Tier B postcode.

reinsured means a person who has entered into a contract of reinsurance with the Corporation.

Tier A postcode means a postcode mentioned in Part 1 of Schedule 1.

Tier A property means eligible property located in an area in Australia that has a Tier A postcode.

Tier B postcode means a postcode mentioned in:

 (a) subclause 7 (1) or (3); or

 (b) Part 2 of Schedule 1.

Tier B property means eligible property located in an area in Australia that has a Tier B postcode.

Tier C postcode means a postcode mentioned in:

 (a) subclause 8 (1); or

 (b) Part 3 of Schedule 1.

Tier C property means eligible property located in an area in Australia:

 (a) that has a Tier C postcode; or

 (b) that does not have a postcode mentioned in:

 (i) subclause 7 (1) or (3); or

 (ii) a table in Schedule 1.

Note   Several terms and expressions in these Directions have the meaning given by the Act, including:

 Australia

 Corporation

 eligible insurance contract

 eligible property.

5 Working out premium income if subclause 6 (2) does not apply

 (1) Use the following steps to work out the amount of premium income for an eligible insurance contract to which subclause 6 (2) does not apply.

Step 1

Identify the amount of the premium written by the reinsured that is attributable to the eligible insurance contract.

Step 2

Identify the amount of the portion of the premium mentioned in Step 1 that has been refunded to a reinsured as a result of adjustments or cancellations related to the eligible insurance contract.

Step 3

Subtract the amount identified under Step 2 from the amount identified under Step 1.

Step 4

Identify the portion of the amount worked out under Step 3 that is attributable to the GST or a stamp duty or levy imposed on the contract under the law of a State or Territory.

Step 5

Work out the amount of premium income by subtracting the amount worked out under Step 4 from the amount worked out under Step 3.

 (2) In this clause:

amount, for Step 2, includes a nil amount.

6 Working out premium income for certain eligible insurance contracts

Application

 (1) Subclause (2) applies to an eligible insurance contract:

 (a) that comprises 2 or more distinct insurance covers that have been packaged or bundled together; and

 (b) that is offered on the basis that the insured must take out one or more of the number of insurance covers offered; and

 (c) in relation to which the premium attributable to each insurance cover the eligible insurance contract comprises is precisely quantifiable; and

 (d) that contains:

 (i) some insurance covers, each of which, if provided individually, would be an eligible insurance contract; and

 (ii) other insurance covers, none of which, if provided individually, would be an eligible insurance contract.

Steps for working out premium income

 (2) Use the following steps to work out the amount of premium income for an eligible insurance contract mentioned in subclause (1).

Step 1

Add together the premiums attributable to each insurance cover provided by the contract that, if provided individually, would be an eligible insurance contract.

Step 2

For each premium mentioned in Step 1, identify the amount of the portion of the premium that has been refunded to a reinsured as a result of adjustments or cancellations in relation to an insurance cover mentioned in Step 1.

Step 3

Add together each amount identified under Step 2.

Step 4

Subtract the amount worked out under Step 3 from the amount worked out under Step 1.

Step 5

Identify the portion of the amount worked out under Step 4 that is attributable to the GST or a stamp duty or levy imposed on the contract under the law of a State or Territory.

Step 6

Work out the amount of premium income by subtracting the amount worked out under Step 5 from the amount worked out under Step 4.

 (3) In this clause:

amount, for Step 2, includes a nil amount.

7 New Tier B postcodes

New postcode allocated to a new area

 (1) Subclause (2) applies if:

 (a) an area in Australia has a postcode included in Part 2 of Schedule 1; and

 (b) Australia Post:

 (i) divides the area into 2 or more new areas; and

 (ii) allocates a new postcode to each new area.

 (2) Each new postcode is a Tier B postcode.

New or existing postcode allocated to increased area of population centre

 (3) Subclause (4) applies if:

 (a) the area a population centre occupies increases; and

 (b) Australia Post allocates either of the following:

 (i) a new postcode to the population centre;

 (ii) an existing postcode to the increased part of the area the population centre occupies.

 (4) A postcode allocated to the population centre or the increased part of the area is a Tier B postcode.

8 New Tier C postcodes

 (1) Subclause (2) applies if:

 (a) an area in Australia has a postcode included in Part 3 of Schedule 1; and

 (b) Australia Post:

 (i) divides the area into 2 or more new areas; and

 (ii) allocates a new postcode to each new area.

 (2) Each new postcode is a Tier C postcode.

9 Corporation must charge premium in accordance with specified rates

 (1) For subsection 38 (2) of the Act, the premium that the Corporation must charge for a reinsured eligible insurance contract is the percentage of premium income mentioned, for the type of cover provided by the eligible insurance contract, in column 3 of the following table.

Item

Type of cover

Percentage of premium income

1

Loss of or damage to eligible property that is owned by the insured

 (a) for an eligible insurance contract covering Tier A property — 12% of premium income; and

 (b) for an eligible insurance contract covering Tier B property — 4% of premium income; and

 (c) for an eligible insurance contract covering Tier C property 2% of premium income

2

Business interruption and consequential loss arising from:

 (a) loss of, or damage to, eligible property that is owned or occupied by the insured; or

 (b) inability to use eligible property, or part of eligible property, that is owned or occupied by the insured

 (a) for an eligible insurance contract covering Tier A property — 12% of premium income; and

 (b) for an eligible insurance contract covering Tier B property 4% of premium income; and

 (c) for an eligible insurance contract covering Tier C property 2% of premium income

3

Liability that arises out of the insured being the owner or occupier of eligible property

Nil

Note   For the definition of premium income, see clause 4.

 (2) In this clause:

  reinsured eligible insurance contract means an eligible insurance contract covered by a contract of reinsurance entered into by a reinsured and the Corporation.

Schedule 1 Tiers A, B and C postcodes

(regulation 4)

Part 1 Tier A postcodes

2000

2009

2060

3000

3005

3006

3008

4000

5000

6000

6003

Part 2 Tier B postcodes

  800

  810

  812

  820

  909

2006

2007

2008

2010

2011

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

2033

2034

2035

2036

2037

2038

2039

2040

2041

2042

2043

2044

2045

2046

2047

2048

2049

2050

2052

2061

2062

2063

2064

2065

2066

2067

2068

2069

2070

2071

2072

2073

2074

2075

2076

2077

2079

2080

2081

2082

2085

2086

2087

2088

2089

2090

2091

2092

2093

2094

2095

2096

2097

2099

2100

2101

2102

2103

2104

2105

2106

2107

2109

2110

2111

2112

2113

2114

2115

2116

2117

2118

2119

2120

2121

2122

2125

2126

2127

2128

2130

2131

2132

2133

2134

2135

2136

2137

2138

2139

2140

2141

2142

2143

2144

2145

2146

2147

2148

2150

2151

2152

2153

2154

2155

2160

2161

2162

2163

2164

2165

2166

2167

2168

2170

2171

2172

2174

2175

2176

2177

2190

2191

2192

2193

2194

2195

2196

2197

2198

2199

2200

2203

2204

2205

2206

2207

2208

2209

2210

2211

2212

2213

2214

2216

2217

2218

2219

2220

2221

2222

2223

2224

2225

2226

2227

2228

2229

2230

2231

2232

2234

2251

2256

2257

2260

2261

2262

2263

2280

2282

2284

2285

2287

2289

2290

2291

2292

2293

2294

2295

2296

2297

2298

2299

2300

2302

2303

2304

2305

2306

2307

2308

2485

2500

2502

2505

2506

2515

2516

2517

2518

2519

2522

2525

2526

2528

2529

2558

2559

2564

2565

2566

2567

2600

2601

2602

2603

2604

2605

2606

2607

2609

2612

2614

2615

2617

2747

2750

2760

2761

2762

2763

2766

2767

2768

2770

2773

2774

2777

2900

2902

2903

2904

2905

2906

2911

2913

2914

3002

3003

3004

3010

3011

3012

3013

3015

3016

3018

3019

3020

3021

3022

3023

3025

3026

3028

3029

3031

3032

3033

3034

3037

3038

3039

3040

3041

3042

3043

3044

3045

3046

3047

3048

3049

3050

3051

3052

3053

3054

3055

3056

3057

3058

3060

3061

3062

3065

3066

3067

3068

3070

3071

3072

3073

3074

3075

3078

3079

3081

3082

3083

3084

3085

3086

3087

3088

3089

3093

3094

3095

3101

3102

3103

3104

3105

3106

3107

3108

3109

3111

3113

3114

3121

3122

3123

3124

3125

3126

3127

3128

3129

3130

3131

3132

3133

3134

3135

3136

3137

3138

3140

3141

3142

3143

3144

3145

3146

3147

3148

3149

3150

3151

3152

3153

3154

3155

3156

3158

3161

3162

3163

3165

3166

3167

3168

3169

3170

3171

3172

3173

3174

3175

3177

3178

3179

3180

3181

3182

3183

3184

3185

3186

3187

3188

3189

3190

3191

3192

3193

3194

3195

3196

3197

3198

3199

3200

3201

3202

3204

3205

3206

3207

3214

3215

3218

3219

3220

3428

3752

3765

3766

3767

3785

3786

3787

3796

3800

3802

3803

3805

3806

3910

3911

3930

3931

3934

3936

3938

3975

3976

4005

4006

4007

4008

4009

4010

4011

4012

4013

4014

4017

4018

4019

4020

4021

4022

4029

4030

4031

4032

4034

4035

4036

4037

4051

4053

4054

4055

4059

4060

4061

4064

4065

4066

4067

4068

4072

4073

4074

4075

4076

4077

4078

4101

4102

4103

4104

4105

4106

4107

4108

4109

4110

4111

4112

4113

4114

4115

4116

4117

4118

4119

4120

4121

4122

4123

4124

4125

4127

4128

4129

4130

4131

4132

4133

4151

4152

4153

4154

4155

4156

4157

4158

4159

4160

4161

4163

4164

4165

4169

4170

4171

4172

4173

4174

4178

4179

4184

4205

4207

4208

4209

4210

4212

4214

4215

4216

4217

4218

4219

4220

4221

4224

4225

4226

4227

4229

4230

4271

4300

4301

4303

4304

4305

4500

4501

4502

4503

4504

4505

4506

4508

4509

4551

4556

4557

4558

4564

4566

4567

4572

4573

4575

4810

4812

4813

4814

5005

5006

5007

5008

5009

5010

5011

5012

5013

5014

5015

5016

5017

5018

5019

5020

5021

5022

5023

5024

5025

5126

5031

5032

5033

5034

5035

5037

5038

5039

5040

5041

5042

5043

5044

5045

5046

5047

5048

5049

5050

5051

5052

5061

5062

5063

5064

5065

5066

5067

5068

5069

5070

5072

5073

5074

5075

5076

5081

5082

5083

5084

5085

5086

5087

5088

5089

5090

5091

5092

5093

5094

5095

5096

5097

5098

5106

5107

5108

5109

5111

5112

5113

5127

5158

5159

5160

5161

5162

5164

5165

5166

5167

5168

5169

5170

5173

5246

5950

6004

6005

6006

6007

6008

6009

6010

6011

6012

6014

6015

6016

6017

6018

6019

6020

6021

6022

6023

6024

6025

6026

6027

6028

6029

6030

6036

6050

6051

6052

6053

6054

6055

6056

6057

6058

6059

6060

6061

6062

6063

6064

6066

6070

6090

6100

6101

6102

6103

6104

6105

6106

6107

6108

6147

6148

6149

6150

6151

6152

6153

6154

6155

6156

6157

6158

6159

6160

6162

6163

6164

6907

7000

7004

7005

7007

7008

7009

7010

7011

7015

7016

7018

7019

7053

Part 3 Tier C postcodes

  828

  829

  830

  832

  835

  836

  837

  838

  840

  841

  845

  846

  847

  850

  852

  853

  854

  860

  862

  870

  872

  880

  885

  886

2083

2084

2108

2156

2157

2158

2159

2173

2178

2179

2233

2250

2258

2259

2264

2265

2267

2278

2281

2283

2286

2309

2311

2312

2314

2315

2316

2317

2318

2319

2320

2321

2322

2323

2324

2325

2326

2327

2328

2329

2330

2331

2333

2334

2335

2336

2337

2338

2339

2340

2341

2342

2343

2344

2345

2346

2347

2350

2351

2352

2353

2354

2355

2356

2357

2358

2359

2360

2361

2365

2369

2370

2371

2372

2379

2380

2381

2382

2386

2387

2388

2390

2395

2396

2397

2398

2399

2400

2401

2402

2403

2404

2405

2406

2408

2409

2410

2411

2415

2420

2421

2422

2423

2424

2425

2426

2427

2428

2429

2430

2431

2439

2440

2441

2443

2444

2445

2446

2447

2448

2449

2450

2452

2453

2454

2455

2456

2460

2462

2463

2464

2465

2466

2469

2470

2471

2472

2473

2474

2475

2476

2477

2478

2479

2480

2481

2482

2483

2484

2486

2487

2488

2489

2490

2508

2527

2530

2533

2534

2535

2536

2537

2538

2539

2540

2541

2545

2546

2548

2549

2550

2551

2555

2556

2557

2560

2563

2568

2569

2570

2571

2572

2573

2574

2575

2576

2577

2578

2579

2580

2581

2582

2583

2584

2585

2586

2587

2588

2590

2594

2611

2618

2619

2620

2621

2622

2623

2624

2625

2626

2627

2628

2629

2630

2631

2632

2633

2640

2641

2642

2643

2644

2645

2646

2647

2648

2649

2650

2651

2652

2653

2655

2656

2658

2659

2660

2661

2663

2665

2666

2668

2669

2671

2672

2675

2678

2680

2681

2700

2701

2702

2703

2705

2706

2707

2710

2711

2712

2713

2714

2715

2716

2717

2720

2721

2722

2725

2726

2727

2729

2730

2731

2732

2733

2734

2735

2736

2737

2738

2739

2745

2748

2749

2752

2753

2754

2755

2756

2757

2758

2759

2765

2769

2775

2776

2778

2779

2780

2782

2783

2784

2785

2786

2787

2790

2791

2792

2793

2794

2795

2797

2798

2799

2800

2803

2804

2805

2806

2807

2808

2809

2810

2820

2821

2823

2824

2825

2827

2828

2829

2830

2831

2832

2833

2834

2835

2836

2839

2840

2842

2843

2844

2845

2846

2847

2848

2849

2850

2852

2864

2865

2866

2867

2868

2869

2870

2871

2873

2874

2875

2876

2877

2878

2879

2880

2890

2898

2899

2912

3024

3027

3030

3036

3059

3063

3064

3076

3090

3091

3096

3097

3099

3115

3116

3139

3159

3160

3211

3212

3216

3217

3221

3222

3223

3224

3225

3226

3227

3228

3230

3231

3232

3233

3235

3236

3237

3238

3239

3240

3241

3242

3243

3249

3250

3251

3254

3260

3264

3265

3266

3267

3268

3269

3270

3271

3272

3273

3274

3275

3276

3277

3278

3279

3280

3281

3282

3283

3284

3285

3286

3287

3289

3292

3293

3294

3300

3301

3302

3303

3304

3305

3309

3310

3311

3312

3314

3315

3317

3318

3319

3321

3322

3323

3324

3325

3328

3329

3330

3331

3332

3333

3334

3335

3337

3338

3340

3341

3342

3345

3350

3351

3352

3355

3356

3357

3360

3361

3363

3364

3370

3371

3373

3374

3375

3377

3378

3379

3380

3381

3384

3385

3387

3388

3390

3391

3392

3393

3395

3396

3400

3401

3407

3409

3412

3413

3414

3415

3418

3419

3420

3423

3424

3427

3429

3430

3431

3432

3433

3434

3435

3437

3438

3440

3441

3442

3444

3446

3447

3448

3450

3451

3453

3458

3460

3461

3462

3463

3464

3465

3467

3468

3469

3472

3475

3477

3478

3480

3482

3483

3485

3487

3488

3489

3490

3491

3494

3496

3498

3500

3501

3505

3506

3507

3509

3512

3515

3516

3517

3518

3520

3521

3522

3523

3525

3527

3529

3530

3531

3533

3537

3540

3542

3544

3546

3549

3550

3551

3555

3556

3557

3558

3559

3561

3562

3563

3564

3565

3566

3567

3568

3570

3571

3572

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Note

1. All legislative instruments and compilations are registered on the Federal Register of Legislative Instruments kept under the Legislative Instruments Act 2003. See http://www.frli.gov.au.