ALP gains profits from Warranty Insurance insurer

ZEBRA looks and listens Review: August 4th, 2008

ZEBRAaustralia thinks that if Labor is serious about looking after consumers it could at the very least work behind the scenes to clean up this mess and ensure that the insurance scheme was of value! Would that be a bridge too far?

In any event the Property Review is providing consumers with a good service by bringing this information to consumers attention. This story is a salutary tale!

The Property Review Story

"EXCLUSIVE: THE Australian Labor Party has been linked to the major supplier of Builders Warranty Insurance, Vero, through its multimillion dollar investment in the insurer’s parent company Suncorp.

Currently, there is a Labor party dominated Senate Economics Committee Inquiry into Builders Warranty Insurance, which has been described ‘useless’ by consumer advocates. The ALP holds around 1.8 million shares in Suncorp valued last Friday at around $21 million.

The ALP has collected around $8 million in dividends from its investment in Suncorp. (Source: AFR) Vero Insurance is the main provider of builders warranty insurance through its connection with the Housing Industry Association. Vero is controlled by Promina, which is owned by Suncorp.

Sources close to the Inquiry told PropertyReview.com.au late last week that the Senators sitting on the Inquiry and keen to ‘pass the buck and refer the problem of ‘joke insurance’, as described in The Melbourne Age last weekend, back to the State governments Regrettably, for those opposing builders warranty insurance, the State governments were builders warranty insurance reigns – New South Wales and Victoria – are Labor controlled governments.

“As if they are going to scrap warranty insurance through their shares in Suncorp Metway the Labor has profited indirectly from the misery of thousands of consumers and builders around Australia ,” one consumer advocate told PropertyReview.com.au.

“It is not in the best interests of the ALP to scrap warranty insurance despite evidence that it has let consumers and builders down,” she added. “There should be a Royal Commission into Builders Warranty Insurance and the ALP’s connections with the major provider of the insurance, Vero.

” PropertyReview.com.au has been told that in recent times the Senate Inquiry committee has met secretly with Vero and it meeting today behind closed doors with HIA Insurance Services. Both the NSW and Victorian Opposition have declared they will scrap warranty insurance if they are elected.

Meanwhile, the HIA, one of the major beneficiaries of warranty insurance kickbacks, have damned submissions by opponents of warranty insurance.

The submissions can be found at the Senate website at: http://www.aph.gov.au/senate/committee/economics_ctte/home_warranty_08/submissions/sublist.htm The HIA also complained bitterly about PropertyReview.com.au’s story last week entitled “Senate inquiry into warranty insurance a whitewash?”.

We have given the HIA a right of reply, however, must point out that the HIA’s claim in its letter to the editor last week that we had broken parliamentary privilege was blatantly false and misleading. We stand by the story and once again offer the HIA a right to reply, but point out the last time we tried to interview the HIA on the subject they literally hung up on our reporter."

PropertyReview.com.au