✨ Motor Vehicle Account Levy Information
NEW ZEALAND GAZETTE, No. 42 — 20 APRIL 2017
| 2021/22 | 140.62 | 512 | 555 | 67 | 152.51 | 18.46 | 12,160 | 10,906 | 1,254 |
| 2022/23 | 140.62 | 518 | 579 | 70 | 157.13 | 18.89 | 12,518 | 11,287 | 1,230 |
| 2023/24 | 154.23 | 575 | 604 | 72 | 162.06 | 19.34 | 12,928 | 11,696 | 1,232 |
| 2024/25 | 154.23 | 582 | 631 | 75 | 167.32 | 19.79 | 13,349 | 12,140 | 1,208 |
| 2025/26 | 168.49 | 643 | 660 | 77 | 172.92 | 20.18 | 13,821 | 12,616 | 1,204 |
| 2026/27 | 168.49 | 651 | 690 | 80 | 178.69 | 20.61 | 14,294 | 13,120 | 1,174 |
| 2027/28 | 183.58 | 718 | 722 | 83 | 184.59 | 21.13 | 14,839 | 13,650 | 1,189 |
| 2028/29 | 183.58 | 726 | 755 | 85 | 190.87 | 21.56 | 15,383 | 14,202 | 1,181 |
*Motorcycle Safety Levy
**Outstanding Claims Liability
The table above presents the projected levy and funding path after applying the funding policy. The table below summarises the key assumptions underlying these projections.
Motor Vehicle Account Key Assumptions
| Year ending 30 June | Claim numbers (entitlement claims) | Entitlement claim frequency (claims per 1,000 vehicles) | Exposure (number of vehicles) (000) | Investment return forecasts (June year) | Risk-free interest rates (June year) | Standard inflation (LCI*) |
|---|---|---|---|---|---|---|
| 2016/17 | 5,816 | 1.70 | 3,429 | 4.1% | 2.0% | 1.8% |
| 2017/18 | 6,015 | 1.73 | 3,470 | 4.3% | 1.9% | 1.8% |
| 2018/19 | 6,096 | 1.74 | 3,512 | 4.4% | 2.3% | 1.8% |
| 2019/20 | 6,169 | 1.74 | 3,554 | 4.5% | 2.6% | 1.8% |
| 2020/21 | 6,243 | 1.74 | 3,596 | 4.6% | 3.0% | 1.8% |
| 2021/22 | 6,318 | 1.74 | 3,639 | 4.8% | 3.3% | 1.8% |
| 2022/23 | 6,394 | 1.74 | 3,683 | 4.9% | 3.5% | 1.8% |
| 2023/24 | 6,471 | 1.74 | 3,727 | 5.0% | 3.7% | 1.8% |
| 2024/25 | 6,548 | 1.74 | 3,772 | 5.1% | 3.8% | 1.8% |
| 2025/26 | 6,627 | 1.74 | 3,817 | 5.1% | 3.9% | 1.8% |
| 2026/27 | 6,706 | 1.74 | 3,863 | 5.2% | 4.0% | 1.8% |
| 2027/28 | 6,787 | 1.74 | 3,909 | 5.3% | 4.1% | 1.8% |
| 2028/29 | 6,868 | 1.74 | 3,956 | 5.3% | 4.1% | 1.8% |
- Labour Cost Index
The following table compares the components of the 2017/19 prescribed average levy rate with those of the 2016/17 rate. The first column shows the components of the 2016/17 prescribed levy rate derived for the 2016/17 levy consultation. The second column shows the estimates of new-year claim costs and administration costs for the same year differ when calculated using the revised assumptions used for the 2017/19 levy period. The third column then shows how these costs have changed for the new levy period.
Trend in Underlying Costs
| Initial 2016/17 (last year's assessment) | Current 2016/17 (this year's assessment) | Prescribed 2017/19 levy rate | |
|---|---|---|---|
| Average levy per motor vehicle | |||
| To fund the cost of new claims during the new levy year | $132.88 | $131.41 | $137.64 |
| To fund administration costs | $17.07 | $15.27 | $16.44 |
| Funding adjustment | -$19.69 | -$40.14 | |
| Average Motor Vehicle levy rate | $130.26 | $113.94 |
The estimate of claim costs for 2016/17 has decreased slightly. 2017/19 claim costs are projected to increase compared with the 2016/17 estimate because of medical and rehabilitation cost inflation above the Labour Cost Index (LCI). Additionally, projections for claim durations have been increased to reflect recent trends in rehabilitation performance.
Appendix B: Explanatory Notes
Funding Adjustment
This is the adjustment to levy rates which is used to move the funding ratio of an Account towards the funding target. The impact of funding adjustments is that levy rates will be higher or lower than the level needed to fund the cost of new-year claim costs (including administration costs).
Funding Ratio
The funding ratio is the ratio of each Account's assets to liabilities. It is a measure of whether the Accounts have
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NZ Gazette 2017, No 42
✨ LLM interpretation of page content
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Motor Vehicle Account Levy Information
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🏥 Health & Social WelfareACC, Motor Vehicle Account, Levy Rates, Insurance, Vehicle Owners, Funding Policy, Claims Experience, Economic Factors