Child abuse survivors failed twice by NSW Government


Young people who were abused in foster care risk being failed again as government contracted out-of-home care providers face an insurance crisis that will leave them unable to pay damages to survivors.

Insurers are refusing to provide cover to out-of-home care providers because it has become unprofitable as the amount and value of abuse claims rise.

The NSW Coalition must urgently provide a state sponsored solution to ensure the almost 13,000 NSW children currently in care and past victims don’t risk being failed twice by a system that promised to protect them.

Greens MP David Shoebridge said:

“Many out of home care providers are already uninsured which leaves these vulnerable children even more at risk.

“Even a modest number of uninsured claims puts the sector at serious risk of financial meltdown. Survivors of state care abuse deserve protection, not a second tragedy from a careless government.

“Children who suffer abuse or neglect are in many cases scarred for life and they need and deserve full and fair compensation to help them heal and move forward.

“The government promised to provide better care of these children than their own families, they must take full responsibility for any abuse, neglect or violence they suffered while in care.

“As a result of the Royal Commission changes have been made to improve child safety in foster care but this follows decades of past failures by state governments and NGOs which will inevitably produce hundreds more claims.

“Compensation can help a young person turn their life around, it can help deliver a stable, safe home with the professional support to heal wounds and move toward a brighter future. This is what’s at risk if there is no insurer to meet the claim.

“Insurers will only write premiums where they think they will gain a profit and in this sector insurers have been losing millions of dollars to cover past claims. If private insurers fall away then the state government must step up, it's that simple.

“We’ve seen this sort of crisis in home building warranty - where all private insurers withdrew and now almost two decades later the state government is still having to provide insurance. If it is good enough for homeowners, then surely kids who were abused in care deserve the same.

“The government must urgently step in to establish alternative insurance arrangements to ensure survivors are protected and non-government providers have adequate insurance cover.

“This insurance crisis is hitting hard in the NGO sector, but of even greater concern is how it impacts on survivors of abuse, who may not be able to recover damages for the harm they have suffered,” Mr Shoebridge said.



Every year about 1,200 young people in NSW exit out-of-home care. Approximately 850 children left the care of the Department of Communities and Justice by turning 18 last year.

All children in care have a legislated right to legal support to seek redress for any harm whilst in the care of the NSW government.

Given the high risks of children experiencing harm whilst in care and the large number of children leaving care each year, the insurance crisis poses great risk both to providers as well as survivors.

The NSW Department of Communities and Justice has responded to the insurance crisis by developing a Short-Term Indemnity Scheme for Physical & Sexual Assault claims, however this falls drastically short of addressing the risk and fails to cover claims for events that predate 2017.

With the average claim taking 12.5 years to come forward, this coverage is manifestly inadequate.