PMPA levy spending and insurance prices
Farrelly questioned whether the 2 per cent insurance levy was funding cheaper PMPA cover and advertising. The Minister said the administrator answers to the High Court and that he had approved a substantial price increase to support the company’s long-term viability.
As the Minister is aware, there is a 2 per cent levy on insurance for people in other companies. How much of this money has been spent by the PMPA to give cheaper insurance to people insured by them? That company are spending a lot on advertising and it is taken from the proceeds of the 2 per cent levy.
Comment on this
The administrator acts with the approval of the High Court and is answerable to the High Court. I deal with the company as the regulatory authority in respect of my supervisory powers with regard to reserves and price increase applications. Recently I granted a substantial price increase to the PMPA to allow the company to compete in the market and to get sufficient revenues that will ensure their viability in the long term. That is the objective of the Government.