BATHURST Regional Council will not be joining a class action by other Central West councils who are attempting to recoup millions of dollars due to alleged excessive insurance premiums.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
The class action was filed this week against multinational insurance broker Jardine Lloyd Thompson (JLT) who was acting on behalf of many of the state’s 128 local councils through Statewide Mutual.
Some councils, including Orange, Parkes and Mid-Western, have joined the class action and claim that since leaving JLT they have saved hundreds of thousands of dollars each year in insurance costs.
Parkes council has saved around $230,000 a year on insurance since leaving JLT while Mid-Western saved around $300,000 on the first year alone.
Bathurst council general manager David Sherley said council had utilised JLT as a broker for more than 14 years.
“Council is aware of the class action but has no intention to take part,” he said.
Law firm Quinn Emanuel Urquhart and Sullivan (QE) this week lodged the class action on behalf of all local councils and managing partner Michael Mills said many of them were still with Statewide Mutual.
“They’ve been overpaying for many years,” he said of the mutual’s member councils.
Mr Mills said it was not uncommon or large corporations and businesses to seek out a broker to secure competitively-priced insurance policies due to the complex nature of the premiums needed.
He alleges that JLT did not “shop around” for better priced insurance policies for councils and that it may have had a “conflict of interest” in selecting higher cost premiums that led to commissions for JLT.
Mid-Western Regional Council director community Simon Jones confirmed on Friday that they had joined the class action against JLT.
“In 2016, Mid-Western Regional Council began the process of tendering for its insurance brokerage services,” he said.
“This resulted in savings of around 30 per cent on the insurance premiums that we had been paying previously.
“It is estimated that there was a saving of around $300,000 for the first year alone as a result of going through the tender process, leaving Statewide Mutual and changing brokers.
“Mid-Western believes we may have been overpaying for insurance premiums for many years based on the advice of JLT.”
READ ALSO: Latest Bathurst news and sport
Cabonne, Cowra and Dubbo councils have confirmed to Fairfax Media that they will also not be joining the class action.
Other Central West councils were contacted but did not provide a response.
More information is available on the JLT Local Council Class Action website.
You can sign up now for our free morning headlines email
Nadine Morton
Nadine Morton covers emergency services and breaking news for the Illawarra Mercury. She takes pride in regional journalism which she believes is crucial to informing our towns and cities. Have a story? Email her at nadine.morton@austcommunitymedia.com.au
Nadine Morton covers emergency services and breaking news for the Illawarra Mercury. She takes pride in regional journalism which she believes is crucial to informing our towns and cities. Have a story? Email her at nadine.morton@austcommunitymedia.com.au
