Insurance Industry Calls for Liability Law Reforms as Costs Skyrocket for Entertainment Sectors

The call comes with the release of a white paper highlighting that outdated state-based civil liability laws, untouched for nearly 25 years, are inflating costs significantly.

According to ICA CEO Andrew Hall, while insurers are supporting businesses facing high premium pressures, it's crucial to refine civil liability regulations to ensure they are current and effective. The report suggests that the federal government initiate a national review of tort law and civil liability, focusing on the ability of small and medium enterprises (SMEs) and non-profit organisations to secure insurance.

The white paper offers several reform proposals, including reviewing limitation periods, curbing claim farming, redefining dangerous activities, adjusting non-economic loss damages, and revising worker-to-worker and psychological injury claim processes. These steps aim to alleviate the financial strain on businesses struggling with insurance accessibility and affordability.

Mick Gibb, CEO of the Night Time Industries Association, emphasises the severe threat posed to live performance venues by the lack of accessible and affordable public liability insurance. He warns of the potential economic loss of a sector valued at over $188 billion.

The report also notes that lengthy claim notification processes, often used as tactical delays, add to costs and proposes stricter rules for claims filed more than three years post-injury. It recommends that lawyers declare their intent to file a claim within three months of being engaged. Furthermore, in cases involving both physical and mental injuries, assessments should utilise the greater of the two in common law claims.

Addressing the increase in third-party nervous shock claims, as exemplified by widespread claims following an elderly patient's death, the report suggests imposing a higher threshold for such claims. It even considers amendments to exclude compensation for nervous shock that doesn’t stem from direct injury to the third party.

Finally, the ICA points out that reforms established after a 2002 review have been gradually undermined due to broad judicial interpretations, growing litigation, active plaintiff lawyers, and rising claim costs, especially related to psychological injuries.

Published:Thursday, 16th Oct 2025
Source: Paige Estritori

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Loss Ratio:
The ratio of claims paid by an insurer to the premiums earned, used as a measure of profitability.

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