Bashing via the Courts

The insurance industry is getting very picky over what it will insure.  And it's all down to lawyers, judges and individuals treating business as a cash cow and Aunt Sally to be bled and stoned to solve all manner of problems.

The pull out of Dexta Corporation from home warranty insurance is only the latest saga of the insurance crisis facing Australia.  Now that Dexta's reinsurer, Swiss Re, has pulled the plug saying that they can no longer afford to carry the losses, Australia is left with only one major firm willing to write insurance for house builders.

Coincident with the Dexta pull-out, we have a "dying granny" suing British American Tobacco saying their product caused her to contract cancer.  This begs the question, when does an individual bear responsibility for her own welfare?  Can anyone not have been aware over the past forty years that cigarette smoking causes cancer?  Is there not some obligation on the part of the individual to take measures to avoid harm instead of looking to raid the apparently deep pockets of a firm when things go wrong?

The common thread through these developments is business bashing through the courts.  Payouts from this create costs.  These require businesses to put up prices, increase production expenditures or exit the activity.  In the case of home building, there are reports of premiums increasing threefold yet still the cake was not worth the ha'penny to Dexta/Swiss Re.

Insurance industry problems are bringing action by State and Commonwealth Ministers.  Ministers want to put caps on payouts and to ensure that those who suffer losses are not themselves to blame.  Rather pointedly, the State Attorneys General have been left out of the action.  Too often they are captives of the plaintiff lawyers who have much to gain from litigation against business.

This is particularly evident with our very own Rob Hulls.  Mr Hulls actually wants to extend business bashing by jailing company directors following workplace accidents.  Rob Hulls blusters "One death in the workplace is one too many".  Well so it is, but what Mr Hulls did not tell us is that a death caused by Government negligence is more acceptable.

You see, Mr Hulls's proposal applies only to non-government company executives and directors.  It is only they who would be jailed for not being sufficiently aware that work practices in the businesses they own or control might lead to injury.  Government ministers, who are responsible for huge workforces, would be immune.  Why not include them?  Imagine Mr Hulls reaction from his Ministerial colleagues if he were to suggest that the Minister for Justice be made liable to be jailed for the death of a prison officer!

It all goes to show some politicians are quite happy to dish it out but refuse to take it themselves.

NSW Premier Bob Carr is leading the charge for reform to reduce business liability.  His reaction to Mr Hulls's proposals?  He'd be laying a welcome mat across the Murray for the firms streaming out of Victoria to relocate elsewhere.

ADVERTISEMENT