RACQ has announced its intention to withdraw from the Queensland CTP scheme. It is one of the four CTP insurers in Qld and has a 20-year record of providing CTP. Some 1.2 million motorists choose RACQ, which is a 26% share of the CTP market.
The end of CTP from RACQ
The insurer plans to cease offering CTP in Qld on 1 October 2023. It has formally requested approval for the Motor Accident Insurance Commission to withdraw its CTP licence. If this goes ahead*, there will be only three CTP insurers in Qld.
RACQ claims it lost $25 million on CTP in the past financial year. The problem is premiums are shared equally between the insurers but in fact, RACQ carries more risk than the others. It has a bigger share of older cars, which are more likely to be involved in accidents.
The insurer said for every $100 of premium received in 2022, it paid out $123 in claims and expenses and 2023 was looking very similar. The insurer has suggested a premium equalisation scheme, like the one in NSW, but with no success. It is not confident the current review into the Qld CTP scheme will change this.
What this means for RACQ holders
Until 1 October 2023, the RACQ will continue to renew or sell new CTP policies to Qld vehicle owners. After that, it will no longer offer CTP policies in Qld.
Existing vehicle owners with RACQ policies will still be covered under those policies. Over the following 12 months, when their registration is due, they will transition to another insurer. Any CTP claimants with a claims process underway or any who have a claim in the next 12 months, will not be disrupted.
Currently, Queenslanders can choose an insurer when they renew registration. Suncorp has the largest market share, with 42.6%, RACQ has 26.1%, Allianz has 23.7% and QBE has 7.6% market share.
Allianz ceases to offer At-Fault Driver Protection
Meanwhile, Allianz stopped offering complimentary At Fault Driver Protection from 1 July 2023*. This will not affect vehicle owners who already have a policy or who are claiming on that policy.
It appears the CTP scheme in Qld is in a state of flux as it is currently under review.
* Postscript: RACQ formally exited the Qld CTP scheme from 1 October 2023. QBE and Suncorp both withdrew At-Fault Driver Protection during August 2023.