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NSW Work Health and Safety Amendments


The impact on insurance coverage for penalties and fines

Published on 19th March 2020

The human impact of an individual death is traumatic and far-reaching . For the families and friends of those individuals killed at their place of work, the loss has had a profound and lasting impact on their lives. 

As a result, Australia has recently seen a continuous debate surrounding Workplace Health and Safety legislation, following a national review into Australia's model Work Health and Safety laws. 

The review considered the appropriateness of insurance policies covering fines and penalties from offences committed under workplace laws. Subsequently, a recommendation has been proposed to prohibit insurance for WHS related penalties, by making it an offence to:

  • enter into a contract of insurance or other arrangement under which the person or another person is covered for liability for a monetary penalty under the Work Health and Safety legislation;
  • provide insurance or a grant of indemnity for liability for a monetary penalty under the model Work Health & Safety Legislation; and
  • take the benefit of such insurance or such indemnity

Based on the above recommendations, legislation is currently pending in NSW to make it an offence to enter into a contract of insurance to cover liability or monetary penalties, or provide insurances or other indemnity arrangements, with respect to penalties pursuant to the Work Health & Safety Act 2011 (NSW), (NSW WHS Act). The proposed legislation will also make it an offence to take the benefit of such arrangements. 

Melita Simic, Head of FINPRO Technical, Marsh JLT Specialty, Pacific, along with Ciara Donnelly, Senior WHS Consultant for Mercer Marsh Benefits unpack the amendments, the implications this may have on new and future insurance policies and solutions available to employers to mitigate workplace risks. 

Marsh Pty Ltd (ABN 86 004 651 512, AFSL 238983) (“Marsh”) arrange this insurance and is not the insurer. The Discretionary Trust Arrangement is issued by the Trustee, JLT Group Services Pty Ltd (ABN 26 004 485 214, AFSL 417964) (“JGS”). JGS is part of the Marsh group of companies. Any advice in relation to the Discretionary Trust Arrangement is provided by JLT Risk Solutions Pty Ltd (ABN 69 009 098 864, AFSL 226827) which is a related entity of Marsh. The cover provided by the Discretionary Trust Arrangement is subject to the Trustee’s discretion and/or the relevant policy terms, conditions and exclusions. This website contains general information, does not take into account your individual objectives, financial situation or needs and may not suit your personal circumstances. For full details of the terms, conditions and limitations of the covers and before making any decision about whether to acquire a product, refer to the specific policy wordings and/or Product Disclosure Statements available from JLT Risk Solutions on request. Full information can be found in the JLT Risk Solutions Financial Services Guide.