The Victorian Managed Insurance Authority (VMIA) has backed away from its blanket refusal to fund sex abuse redress payments to victims, saying it will “review its position” after it examines the publicly available legislation.
The government insurer argued last week that the redress scheme is not technically compensation under the $4bn national redress scheme – this despite bills in the federal and Victorian parliaments clearly stating the redress scheme does amount to compensation.
In its original statement to The Australian last week, VMIA said its “insurance policies do not cover redress scheme payments, which serve to acknowledge harm rather than meet a legal liability to compensate for damages.”
The VMIA decision was based on the bills the body had been working on, which were referred to a Senate committee in November and which stated that a redress payment was not to be treated as a payment of compensation, a spokeswoman for the VMIA said.
VMIA changed its position this week when it told the publication that “currently, VMIA insurance policies do not cover redress payments. However, in light of developments to the progress of the bills relating to the (scheme)… VMIA will review its position on redress payments when the commonwealth legislation is finalised.’’
The Victorian government currently foots the bill for redress payments through the core budget, though it remains unclear what insurance coverage non-government organisations would receive.
According to industry sources, a side effect of the VMIA decision was that non-government organisations would not receive the expected insurance assistance from VMIA — for example, if abuse occurred at an NGO welfare outlet run for the government, the report said.
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