The MAA does not approve premiums for compulsory auto insurance. The MAA may only reject a premium if it is likely to be excessive or it is unlikely to fully fund the liabilities of the insurer. By statute, insurers must always maintain fully funded premiums. Where the MAA does not intervene, insurers compete for business in the market. While the product is identical, insurers compete on service, reputation and price.
Some insurers also market to and service specific market segments.
New South Wales does not have assigned risk pools or similar pooling arrangements. Insurers must offer cover to all vehicle owners, and insurers are limited to offering discounts or imposing premium loadings to a maximum of plus or minus 15 per cent. Auto Compensation in NSW NSW operates a modified tort compensation scheme for people injured in motor vehicle crashes. Claims are initiated by means of a mandatory claim form. Legal proceedings cannot be commenced until insurers have had an opportunity to assess liability and commence settlement negotiations.