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Our Ark Mutual Limited ACN 627 006 213 entity is a Company Limited by Guarantee.
It is owned by its members and its ad is solely focused on operating Our Ark for the benefit of members. This is described in stitution.
The Board comprises non-executive independent directors, member representative directors and manager representative directors.
Read about the Our Ark board here.
Insurance policies attract government charges for GST, Stamp duty and (in some states) emergency services levies. Risk protection contributions attract GST yet not stamp duty or emergency services levies.
If your organisation currently pay stamp duty or an emergency services levy (NSW, TAS), these fees to not apply to your quote.
Our Ark aims to provide fair pricing up front which is risk responsive - so you may see a further saving on your contribution but this will vary.
In the longer term, any surplus profits made by Our Ark are retained for the benefit of members (including any members that subscribe for a Mutual Capital Instrument).
This means that a favourable claims experience for the Our Ark community could lead to expanded coverage and contribution rebates, amongst other things.
You automatically become a member of Our Ark Mutual when you pay your contribution for risk protection of your organisation.
Our Ark uses a state of the art claim management system to engage the relevant services to resolve claims.
This means Our Ark has access to a comprehensive panel of suppliers and services across Australia and New Zealand.
Our Ark Mutual is not an APRA Insurer.
Our Ark Mutual is a Discretionary Mutual Fund (DMF).
DMFs offer a risk protection, not insurance.
Risk protection is an insurance-like product that may involve an obligation on the DMF to consider all claims submitted by members.
The board of the DMF has a discretion as to whether it will pay the claim.
Our Ark will offer a quote at no cost to you.
We will require your co-operation to provide information about your organisation, its buildings, contents and previous claims history to allow us to give you the best possible price.
Mutual Capital Instruments (MCI) were introduced to the Corporations Act (2001) in 2019.
These financial instruments allow mutuals to issue shares to complement its capital base without altering the member-owned status of the Mutual.
MCIs and MCI Holders' rights are outlined in the company constitution.
The capital to launch Our Ark took the form of MCIs. Following the launch, other organisations and Members have also chosen to hold MCIs to support the growth of the Mutual.
New members are not required to hold MCIs, yet the option is available for large organisations.
MCI holders may receive a return on their investment in the form of dividends paid out of the profits of Our Ark, at the discretion of the board.
On redemption or windup, MCI holders do not receive more than the principal amount invested.
Any surplus funds belong to members, in accordance with the constitution.
A discretionary mutual is a structure that offers risk protection to its members.
Risk protection is similar to insurance as both offer protection against a certain event or risk (for example, damage to buildings from storms).
However, the key difference is:
- Under an insurance policy, the protected entity (the insured) has the contractual right to have their claim paid, if it meets all the policy terms and conditions;
- WIth a discretionary risk product, the protected entity (the protected) has the right to have a claim considered by the Board of the Mutual for payment; this is the exercise of discretion.
This means that if a claim event happens that does not strictly meet the conditions set in the PDS, the Member can still submit a claim and the Board will consider it.
The Board's role is to act in the best interest of the Mutual and, all of its Members.
Whereas you may pay a premium for your insurance, with risk protection contributions (including GST) are paid to the mutual for product once the quote is accepted.
A schedule of protection is issued with the invoice for the contribution amount.
Where the board resolves that the mutual has surplus capital, it may use some of those funds to reduce member future
This is done by way of a contribution rebate which sees the next contribution reduced by the amount of the rebate.
Each contribution rebate is calculated by an algorithm that is driven, amongst other things:
- member tenure (longer = better)
- the size of contribution (higher = better)
- claim experience (less = better)
- the products held (more = better).
An excess is a co-payment made at the point of a claim.
Our Ark risk protection products do not have an excess because we believe that at a time of a claim event, a co-payment adds to an already stressful situation.
Our Ark’s products have a claim hurdle, or a threshold.
Each organisation sets the threshold that works best for their operations. The minimum threshold is $1000.
How do thresholds work?
- If the claim exceeds the hurdle, that amount is not deducted from your claim nor is your organisation required to fund that amount before the claim is paid.
- If the claim is less than the hurdle, your organisation pays the claim amount in full.
This is the difference between a hurdle and an excess – in essence, we still pay that part of the claim once the hurdle is exceeded.
The level of the hurdle is set so that inefficient small claims do not drive Our Ark's administration costs up and we can keep your contributions as low as possible.
Increasing the threshold amount does influence the price charged for protection to your organisation. Talk to us to discuss how to make a threshold work effectively for your organisation.
Our Ark is committed to ensuring our products and services meet your expectations and we value feedback on how we are performing.
Our customer care team is the first point of contact and will aim to resolve your complaint.
We will attempt to respond to your complaint within 15 business days of the date we receive your complaint.
If you wish to dispute the decision about a claim made by Our Ark Mutual, please contact us in the first instance by making a written submission to the Mutual and asking the Board to reconsider their decision.
If you are not satisfied with our decision or if your complaint remains unresolved after 15 business days, you may refer the matter to our Internal Dispute Resolution (IDR) team.
Disputes processed by the IDR team will be presented to a Review Committee. The review will be guided by the principles of good faith, equity and merit. If you are still unhappy with the outcome, you can choose to have the matter resolved externally.
If you are not satisfied with the outcome of your complaint or we do not resolve your complaint within 30 calendar days of the date on which we first received your complaint, you can contact the Australian Financial Complaints Authority (AFCA).
This independent body provides its service free of charge and we will abide by the outcome. The decision is not binding on you.
AFCA is an external complaints resolution scheme approved by ASIC to provide free advice and assistance to consumers to help them in resolving complaints relating to members of the financial services industry. Information about AFCA, and the types of disputes that it can consider, can be found at its website.
Whilst Our Ark is not supervised by APRA, the Board follows many of the principles outlined by APRA in the GPS and CPS prudential standards.
These include, but are not limited to; risk management practices, capital calculations, (re)insurance requirements and information security.
The Mutual's balance sheet is protected by A+ Insurers, which acts like reinsurance bought by insurance companies.
These policies protect the mutual for cases where there is an extraordinarily large claim or a number of claims that arise from the same event.
This means that, in addition to the capital held by the mutual, it has greater capacity to withstand adverse claims experience of the community.
The board of Our Ark requires actuarial assessment of amounts outstanding on past claims to ensure that there are adequate provisions for future payments relating to those claims.
The board also considers prospective analysis of the financial condition of the mutual to inform the level of contributions required, with the intention being that expected claims and operating expenses would be adequately covered by those contributions.
Our Ark's capital base is a combination of Mutual Capital Instrument (MCI) shares and retained earnings from member contributions.
MCIs have been initially funded by the Foundation Member and organisations and individuals associated with it.
Additional MCIs have been issued to support the growth of Our Ark.
Organisations bringing large property portfolios to the Our Ark may choose to purchase MCIs when becoming a member.
Eventually, it is expected that all MCIs will be redeemed and Our Ark will be entirely funded by retained earnings from member contributions.