Two-wheel Crisis Puts Training At A Premium
Sydney Morning Herald
Friday December 5, 2003
The future of the compulsory NSW Motorcycle Rider Training Scheme is under threat due to a dispute over insurance coverage between the Roads and Traffic Authority and its contracted training providers.
Each year, about 30,000 riders are trained under the scheme, which requires novice riders to gain basic riding skills before obtaining a learner's permit and then a provisional licence.
Statistics show a fall in road deaths of motorcycle riders since the inception of the scheme (see below).
Contractors tender to provide training in at privately owned facilities or the RTA's.
Victoria runs a similar scheme, with its Transport Accident Commission providing no-fault insurance for novice riders in training.
In NSW, however, individual contractors are responsible for providing insurance. Novice riders who are injured while training and seek compensation must claim against the trainer's insurance and, if necessary, go to court.
Drive understands that some contractors are unable to afford adequate cover. One contractor, unable to secure insurance, has already left the business.
Honda Australia Rider Training (HART), one of Australia's largest rider training providers, briefly closed its St Ives and Victorian facilities earlier this year because of soaring public liability and professional indemnity insurance costs, particularly since the demise of HIH. It reopened the centres after gaining coverage under Honda's worldwide insurance umbrella.
Under the terms of their contracts, rider training providers are not permitted to speak to the media without the RTA's permission. However, Drive has learned that a recent crisis meeting of contractors was held to discuss the insurance issue.
According to one source, the RTA - which requires novice riders to be trained - is shifting all responsibility for providing insurance and safe facilities on to the contractors.
In effect, the contractors are being forced to run the scheme on the cheap.
Some cannot afford to stay in business because of the high premiums required. They are not able to increase their prices to cover higher insurance costs, because the RTA has capped training fees at $65 for the pre-learner course, $97 for the pre-provisional course and $39 for the motorcycle operator skills test.
Drive has been told training is held in carparks and in places with fences and trees nearby. These facilities are approved by the RTA - but insurance companies regard them as unsafe and decline cover.
Workcover inspectors checking one facility's suitability for rider training deemed it unsafe and wanted it closed down.
An RTA spokesman told Drive that facilities are regularly inspected and audited. The authority claimed it was not aware of any rider training service providers reporting that their facilities have been deemed unsafe.
Drive asked whether the authority could guarantee that all rider training students were protected by personal injury and professional indemnity insurance.
The spokesman's response was that the RTA was not aware of any training contractor currently operating without appropriate insurance, and that evidence of contractors' insurance, including public liability and professional indemnity cover, was inspected at regular intervals.
He said the RTA was aware of three current claims for compensation by novice riders injured while training.
Drive referred to the RTA claims that its checking process is less than thorough and that organisations tendering to provide rider training can do so without appropriate insurance. Another claim is that the RTA has granted permission to some contractors to continue providing training with limited insurance coverage.
The response: "The authority is not aware of [such] instances ... All contractors are required to have the following insurances and provide evidence of current policies: broadform public liability, professional indemnity, worker compensation, comprehensive or third party property damage insurance on training motorcycles, CTP insurance on fully registered motorcycles and fire and extraneous perils plus burglary insurance."
Guy Stanford, the chairman of the NSW Motorcycle Council, believes that the question of who takes responsibility for providing insurance needs to be quickly resolved, or rider training may be in jeopardy.
"The Rider Training Scheme works, and it must continue," Stanford said.
Within three years of compulsory rider training being introduced, in 1990, learner and provisional rider crash rates fell by about 70 per cent (see panel).
"The RTA wants the scheme to be affordable, but the contractors also have to make a profit," he said. "The issue is who should take the risk: students, the RTA or contractors?"
The future of the compulsory NSW Motorcycle Rider Training Scheme is under threat due to a dispute over insurance coverage between the Roads and Traffic Authority and its contracted training providers.
Each year, about 30,000 riders are trained under the scheme, which requires novice riders to gain basic riding skills before obtaining a learner's permit and then a provisional licence.
Statistics show a fall in road deaths of motorcycle riders since the inception of the scheme (see below).
Contractors tender to provide training in at privately owned facilities or the RTA's.
Victoria runs a similar scheme, with its Transport Accident Commission providing no-fault insurance for novice riders in training.
In NSW, however, individual contractors are responsible for providing insurance. Novice riders who are injured while training and seek compensation must claim against the trainer's insurance and, if necessary, go to court.
Drive understands that some contractors are unable to afford adequate cover. One contractor, unable to secure insurance, has already left the business.
Honda Australia Rider Training (HART), one of Australia's largest rider training providers, briefly closed its St Ives and Victorian facilities earlier this year because of soaring public liability and professional indemnity insurance costs, particularly since the demise of HIH. It reopened the centres after gaining coverage under Honda's worldwide insurance umbrella.
Under the terms of their contracts, rider training providers are not permitted to speak to the media without the RTA's permission. However, Drive has learned that a recent crisis meeting of contractors was held to discuss the insurance issue.
According to one source, the RTA - which requires novice riders to be trained - is shifting all responsibility for providing insurance and safe facilities on to the contractors.
In effect, the contractors are being forced to run the scheme on the cheap.
Some cannot afford to stay in business because of the high premiums required. They are not able to increase their prices to cover higher insurance costs, because the RTA has capped training fees at $65 for the pre-learner course, $97 for the pre-provisional course and $39 for the motorcycle operator skills test.
IT KEEPS THEM OUT OF THE STATISTICS
The compulsory NSW Rider Training Scheme was introduced in 1990. Overall motorcycle casualties decreased by 27 per cent in the following decade.
In the same period, annual young rider (under-26) casualties fell from 1664 to 719.
However this figure is also attributable to a 33 per cent decrease in the number of motorcycles registered to young riders.
This in turn is partly due to compulsory rider training, which involves substantial time and cost commitments that deter some people from obtaining a licence.
Since 1995 the number of under-26 casualties per 1000 licences has increased slightly, from 870.5 to 904.7.
Positioned for Safety, an analysis by The Motorcycle Council of NSW, says compulsory rider training may not in fact be making novice riders safer - rather, it may be more effective as a deterrent than as a means of reducing their crash risk.
Correction on 18 Dec 2003
Correction: Last week's rider training story stated that "Since 1995 the number of under-26 casualties per 1000 licences has increased slightly, from 870.5 to 904.7". These figures relate to the number of crashes per 10,000 owners under 26.
© 2003 Sydney Morning Herald