That is just theory. Local jurisdictions can limit liability, or lower it's costs. The insurance market can also vary greatly. The fact you are liable is a different issue from what you should do about it. But he may have simply been asking the question of whether it is mandatory, and to that I think the answer is no. Oz is a lot more namby than Canada. You can get away with all sorts of stuff here, like rules regarding trailering boats, or owning guns etc... You have a big nanny state.