Comments from Resource and final info threads

[Ixion]

On the back of a relicencing form, section 4.2 states...

Yes, the rego levy covers hospital costs. but they are not broken out into cars, trucks, bikes etc. That would require the hospitals to invoice ACC for each person treated. They are not set up for that

So ACC pay the hospitals a lump sum, in bulk. Blah million dollars per year. That comes form the total levies, i don't know how it is (possibly) broken down beyond that

May be interesting to find out

[NighthawkNZ:Me]

Actually no you have not.

Sure if you take $77 and multiply it by the no of cages then you get more money than the $62 mill they said they paid out for us last year. BUT remember that they are moving to the "fully paid" version, which means that they don't just collect what they will need to pay out in a particular year (like they did before). Now they collect what they will pay out that year, as well as what they will pay out in for the entire term of the payouts for those injuries sustained in that particyular years (i.e. they collect the initial costs as well as ALL the future payouts such as physio, loss of income, etc for the life of those injuries in the year that the injuries were sustained). They collect additional money and then estimated what the value of this money (when invested) will be and whether that money will be enough to pay for ALL the costs.

Which is where they got the $77 from. Hate to burst your bubble, but I think if we are going to bitch about things, we need to know the truth and understand where they are coming from.

the 62 million is not last years or the years before... it is pre-1999

[R-Soul]

the 62 million is not last years or the years before... it is pre-1999

No its 2007-2008

See this link:

http://www.acc.co.nz/about-acc/stati...ount/IS0800157

[R-Soul]

I Urge all bikers to make their own submission on ACC levies.

heres my second:

Dear Sirs

I object to the planned levy increases for motorbikes.

The ACC has lost sight of the fact that it is a COMPENSATION scheme, and not an INSURANCE scheme. An insurance scheme allows people at high risk to sue for their money back from those at fault if they are injured, where the injury was not due to fault of their own. In this way, their own costs are reduced.

But the existence of ACC as a compensation scheme has negated the availability of these cost reduction measures for motorcycle riders. In effect motorcycle riders are being penalised financially for the fault of others, and are not being left any recourse to the courts.

This surely goes against the rule of law and against the bill of rights, where recourse to the courts is typically a major foundation of a strong functioning democracy where a minority group are being unfairly targeted. If bike riders are going to be selectively penalised, then we would want our right to sue back to reduce our payouts.

The question is: Does the ACC really want to open this can of worms?

As I have mentioned in a previous submission, it would make more sense for the ACC to focus on penalising those groups to which injuries can be directly attributable, such as drunk drivers, drug users and speeders. This can be done by generally applicable laws that don’t target a minority. The dividing line for increased ACC levies should be between irresponsible and responsible motorists (and I mean all motorists in general). This could be linked to the current point system in use for vehicles.

Other options would be constructive advancements in actively reducing injuries in the first place like compulsory use of high visibility vests, zero limits on alcohol, and compulsory regular refresher advanced driver /rider training.

Please feel free to call me on blah balh if you have any questions.

Your sincerely,

[Ixion]

No its 2007-2008

See this link:

http://www.acc.co.nz/about-acc/stati...ount/IS0800157

Sigh. The 62M is the amount PAID in 2007-8 for claims ORIGINATING in all PREVIOUS years.

In 2008 the ACC (maybe) paid out for an operation for a biker who was still suffering effects form a crash in 2005. That cost , because it was PAID in 2007-8 , comes into the 62M even though the CRASH happened in 2005

Clear?

[MSTRS:Me]

No its 2007-2008

You still seem to be missing the point. There is a difference in New Claims and Active Claims (ongoing treatment from injuries sustained in years past). The total paid out in 2008 was $62M. About $38M of that came from Active Claims.
The fully funded model was begun in 1999, so it is reasonable to assume that the majority of those Active Claims were covered by levies paid in the years 2000-2008. It is also reasonable to assume that some of the current Active Claims are from injuries sustained prior to 1999, but realistically that number would be fairly small.
This implies that ACC are trying to double-dip, by using the figure $62M.

[NighthawkNZ:Me]

No its 2007-2008

Its a misconception that ACC is using against us...

active claims... new claims and current claims

If you are still on ACC from an accident that happened from 1999 then these are not covered by the "fully funded" model and are still "Pay as you go" which we are still paying for.

Accidents after 1999 which is when we changed to the fully funded model are covered

the number of accidents and active claims don't match showing that the active claims are previous years we are still paying for under pay as you go.

ACC have bundled it all together to make it look worse that it is... ie

new claims 1,336
active claims 3,173

we know the 62 million figure and we know the average claim is $19g
the new claims for 2008 1336 x 19,000 = $25,384,000

The other remaining active claims 1837 are previous years which is still being paid for under the pay as you go which is pre-1999

[R-Soul]

the 62 million is not last years or the years before... it is pre-1999

You did not say "part of the 62 m payout was due to accidents pre-2008" (which I fully understand). You said the 62 m payout was pre 1999. Which it clearly is not since the actual payout of 62 m was paid out in 2007-2008.

But we are talking semantics here.

[R-Soul]

The fully funded model was begun in 1999, so it is reasonable to assume that the majority of those Active Claims were covered by levies paid in the years 2000-2008. It is also reasonable to assume that some of the current Active Claims are from injuries sustained prior to 1999, but realistically that number would be fairly small.
This implies that ACC are trying to double-dip, by using the figure $62M.

Actually the accidents from 1999- 2008 that are still active would be included as part of the 62m payout in 2008- but they would have been pre-financed from 1999-2008.

So the 62m payout includes:
1) New claims from 2007-2008
2) Previously financed claims from 1999-2008
3) Previously unfinanced claims pre-1999

The money they are collecting in must be enough for
1) New claims 2007-2008
2) Future costs of new claims 2007-2008
3) Future costs of unfinanced claims pre 1999

Was it the $49m number that was to pay for future costs of new claims and pre-1999 claims?

[MSTRS:Me]

Actually the accidents from 1999- 2008 that are still active would be included as part of the 62m payout in 2008- but they would have been pre-financed from 1999-2008.

Yep. But ACC neglect to mention that.
Based on (a guess at actual $ and number of bikes) ACC Levy being $166pa and 75,000 registered bikes, they collected something like $110M from bike levies over the years 2000-2008. That went a long way towards paying those Active Claims that begun during that time.

So the 62m payout includes:
1) New claims from 2007-2008
2) Previously financed claims from 1999-2008
3) Previously unfinanced claims pre-1999

The money they are collecting in must be enough for
1) New claims 2007-2008
2) Future costs of new claims 2007-2008
3) Future costs of unfinanced claims pre 1999

Yep

Was it the $49m number that was to pay for future costs of new claims and pre-1999 claims?

Forgive me, but where did that figure come from?
We can only guess that $24M (New Claims 2008) would be indicative of each year's new claims into the future. As far as old Active Claims from pre-1999...the figure would be fairly insubstantial as far as medical etc goes. The majority would be in earnings compensation. Any guesses as to how much?

[Ixion]

Yep. But ACC neglect to mention that.
Based on (a guess at actual $ and number of bikes) ACC Levy being $166pa and 75,000 registered bikes, they collected something like $110M from bike levies over the years 2000-2008. That went a long way towards paying those Active Claims that begun during that time.
Yep

Forgive me, but where did that figure come from?
We can only guess that $24M (New Claims 2008) would be indicative of each year's new claims into the future. As far as old Active Claims from pre-1999...the figure would be fairly insubstantial as far as medical etc goes. The majority would be in earnings compensation. Any guesses as to how much?

$49M is theFULLY FUNDED (not paid out) cost of 2007-8 bike claims. From the data they sent me

[brendonjw]

Hey Ixion, did the ACC front up with those figures they promised to you on TV? (I havent seen them put up anywhere but i may have been looking in the wrong place again

[MSTRS:Me]

$49M is theFULLY FUNDED (not paid out) cost of 2007-8 bike claims. From the data they sent me

So, they collect $49M, pay out immediately some $24M, and the balance of $25M covers all future payments for injuries sustained in 2008? And bearing in mind inflation-adjustment, $49M each year going forward?

[NighthawkNZ:Me]

But we are talking semantics here.

Okay I meant to say 62m a good chunk of it is for the pre-1999 claims

[Ixion]

No the 49M is the cost of the claims, over their expected life.. That's the number ACC say they need to collect each year (49M divided by 100000 bikes = $490 = about the average levy they are demanding). However the VALIDITY of the $49M is debateable.

They know exactly what they ACTUALLY pay out. What they MAY have to pay, perhaps 10 years hence, is a guess. Based on a whole lot of debateable arguments.

Essentially they take a look at the claim, say "Oh well, claims like this , they are usually off work for x years/months, cost about $Y for operations etc etc). Note the guesswork here.

Then adjust that for an expected rate of inflation over the expected (guessed) life of the claim. The work out how much money (in 2009 dollars) they need to put into the reserves to cover that (inflated) cost. Based on earning z% on their investments in the future (d' y' see another guess there).

Extend that guesswork across all claims and you have the basis of the ACCs claim of being broke. They have worked out their future liabilities using VERY VERY pessimistic figures for inflation and interest (they admit this) . If inflation is going to be 20% a year,and we'll only get 2% on investments, we need to put a LOT of money aside now.

But if inflation is 2% and investments get 7% then the "lot of money" becomes " a lot LESS money"

The whole ACC deficit/broke/financial crisis is just a rort.

Do all that guesswork on the bike claims lodged in 2008 and you come up with $49 million. I'm told ACC buy their dart boards in truckload lots.