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2022-2023-2024-2025
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
DEFENCE SERVICE HOMES AMENDMENT (INSURANCE) BILL 2025
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Veterans' Affairs and Minister for Defence
Personnel, the Honourable Matthew James Keogh MP)
Defence Service Homes Amendment (Insurance) Bill 2025
General Outline
Purpose
The Defence Service Homes Amendment (Insurance) Bill 2025 (the Bill) will formalise and
regularise longstanding Commonwealth practice by providing the Secretary of the Department of
Veterans' Affairs with the express legislative authority to, on behalf of the Commonwealth, carry out
activities as an agent for an insurer. It will also confirm the validity of past activities the
Commonwealth has taken under the branding of Defence Service Home Insurance, including
insurance policies sold under agreements already entered into with an insurer.
Date of effect
The Bill will commence on the day after it receives the Royal Assent. Part 2 of Schedule 1 to the Bill
operates to confirm the validity of past activities carried out by the Commonwealth as an agent for an
insurer. An effect of that Part is to confirm that all insurance policies that the Department of Veterans'
Affairs (the Department) has sold before the commencement of this Bill are valid and effective. This
practically reassures existing and past policyholders that their policies are effective so claims may be
lodged for their coverage period.
No persons are likely to be detrimentally affected by Part 2 of Schedule 1 to the Bill.
Privacy
In carrying out activities as an agent for an insurer, the Department collects, uses and discloses
personal information of policyholders and prospective policyholders. The collection, use and
disclosure are necessary to provide effective services to those people. For instance, in handling a
claim made by a policyholder, the Department will have to collect personal information of the
policyholder and disclose it to the insurer for the claim to be assessed and resolved. Thus, the
collection of personal information by the Department is consistent with Australian Privacy Principle
(APP) 3.1 under the Privacy Act 1988.
The Department has published a comprehensive privacy policy on its website in compliance with
APP 1. Informed consent is obtained from an individual before their personal information is collected,
used or disclosed to another entity in compliance with APP 6.
Financial impact statement
Financial impacts for the Defence Service Homes Amendment (Insurance) Bill 2025 are estimated to
be an annual revenue of $3.3 million that will be supported by the amendments.
Human rights implications
See the statement of compatibility with human rights set out below.
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Statement of Compatibility with Human Rights
prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Defence Service Homes Amendment (Insurance) Bill 2025
This Bill is compatible with the human rights and freedoms recognised or declared in the international
instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Bill
The Bill will allow the Secretary of the Department of Veterans' Affairs to, on behalf of the
Commonwealth, engage in insurance activities as an agent for an insurer. It will also confirm the
validity of past activities the Commonwealth has taken under the branding of Defence Service Home
Insurance, including the agreements already entered into with an insurer. Most policyholders serviced
by the Department are current or former members of the Australian Defence Force, reservists,
peacekeepers or their family members.
The Bill ensures that people in the veteran community are continued to be covered by policies taken
out with the Department, particularly in relation to policies offered by the Department as an agent for
an insurer.
Human rights implications
The Bill engages and promotes the following rights:
• Right to social security, including social insurance, under article 9 of the International
Covenant on Economic, Social and Cultural Rights
• Right to an adequate standard of living, including food, water and housing, under article 11 of
the International Covenant on Economic, Social and Cultural Rights
• Right to privacy and reputation, under article 17 of the International Covenant on Civil and
Political Rights.
Right to social security and the right to an adequate standard of living, including food, water and
housing
The Bill promotes the right to social security in Article 9 and the right to an adequate standard of
living, including food, water and housing in article 11 of the International Covenant on Economic,
Social and Cultural Rights. Continued access to insurance products sold under the Defence Service
Homes Act 1918 (the DSHA) promotes the rights because it provides protection from unforeseen
financial loss for Australian veterans and families that have taken out an insurance policy under the
scheme.
The right to privacy and reputation
Article 17 of the ICCPR prohibits arbitrary interference with privacy and unlawful attacks on
reputation. This Bill amends the Defence Service Homes Act 1918 to confirm the validity of a range of
activities connected with the Commonwealth's insurance activities under the DSHA, including
activities that would engage protections in the Privacy Act 1988. These activities include the
collection, storage, use and disclosure of personal information of policyholders. The Bill will
formalise the legislative authority for dealing with personal information, as required under the Privacy
Act 1988.
Conclusion
This Bill is compatible with human rights because it promotes the protection of human rights for
veterans and their families.
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Notes on clauses
Schedule 1, Part 1
Item 1 is an amendment to section 6A of the Defence Service Homes Act 1918 (the Act) that is
consequential of inserting new Part VIA into the Act. It allows the Secretary's powers under the new
part to be delegated.
Item 2 inserts a new Part VIA into the Defence Service Homes Act 1918 (the Act) to give the
Commonwealth the express power to engage in insurance activities as an agent for an insurer, to the
extent authorised under paragraph 51(xiv) of the Constitution. The activities that the Commonwealth
may carry out under this power include entering into an arrangement with an insurer to be their agent
and carrying out activities under the arrangement.
Subsection 39(2) will expressly allow the Secretary of the Department of Veterans' Affairs to do
anything necessary or convenient for the purpose of carrying out the insurance activities on behalf of
the Commonwealth.
The intention of section 39 is to capture a broad range of activities that are to be carried out by the
Commonwealth as an agent for an insurer, whether or not the activities are directly related to a formal
arrangement between the insurer and the Commonwealth. The activities can include--
(a) the collection, use and disclosure of personal information; and
(b) anything necessary or convenient to--
(i) sell an insurance product for the insurer; and
(ii) deal with current and past policyholders, particularly in relation to their
claims under their insurance policies; and
(iii) renew or terminate a policy.
Schedule 1, Part 2
Item 3 confirms the validity of all insurance activities carried out by the Commonwealth as an agent
for an insurer since 1 January 1990.
Subitem (1) deems the Commonwealth and the Secretary to have had the powers in the new
section 39 of the Defence Service Homes Act 1918 since 1 January 1990.
Subitems (2), (3) and (4) operate together to validate previous arrangements entered into by the
Commonwealth as well as anything done before this Part commences. The arrangements or things are
deemed to be valid and effective for all purposes, so long as the arrangements or things were entered
into or done by a person working in or for the Department of Veterans' Affairs at that time. The
person could be an APS employee, contractor or consultant working in or for the Department.
Validated arrangements will include an arrangement between the Commonwealth and an insurance
company for the Commonwealth to be an authorised representative of the company.
Subitem (5) ensures that the validation of previous activities and arrangements undertaken by the
Commonwealth is given full effect even if it affects a person's accrued rights. However, if a right or
liability of the parties to judicial proceedings have been finally determined by a court, this item will
not affect the right or liability. This is to provide certainty to the parties that any matters finally
disposed of by a court have effect in accordance with a determination of the court without having to
work out if they are affected by this item.
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Subitem (6) provides that the Commonwealth is liable to pay a reasonable amount of compensation to
a person if the item results in the acquisition of property within the meaning of paragraph 51(xxxi) of
the Constitution.
Subitem (7) gives the person from whom property is acquired the right to bring an action in the
Federal Court of Australia to determine the reasonable amount of compensation, if the
Commonwealth and the person cannot agree on the amount of compensation.
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