The majority of life insurers have acted within the required timeline on claims, following the overhaul of the Life Insurance Code of Practice according to the Life Code Compliance Committee.
The LCCC has published its inaugural Industry Data and Compliance Report looking into the code, which the Financial Services Council said provides evidence of work being done to strengthen the life insurance sector.
FSC senior policy manager Nick Kirwan said Australia is the only nation in the world to compile and collect data in this field.
The Life Insurance Code covers every individually assessed and group life insurance cover that can be taken out in Australia today.
“The LCCC report shows life insurers made decisions on 89 per cent of all income related claims and 92 per cent of all lump sum claims within the required timeframes,” Mr Kirwan said.
“APRA data has previously shown the overwhelming majority of all claims received are paid (92 per cent), and now we also know, thanks to this report that those claims were made in a timely manner, helping customers when they need it most.
“We don’t shy away from the fact that there is more to be done. The LCCC’s inaugural report provides an important baseline to measure the industry against in future years, and insights into areas that the industry should focus its attention.”
He added that the level of support from the industry, with all code subscribers providing data underpinning the report, shows a willingness of the sector to be transparent and just how seriously it takes the issue of regaining customer trust.
Following the announcement of a radical overhaul of the code in November 2018, the FSC has been working with ASIC, consumer advocates, mental health groups, GPs and geneticists to develop the next iteration of the code, and has proposed more than 30 additional protections for consumers to lift standards.
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
You can contact her on [email protected].
The FSC has signalled some of the largest global fund managers are seeing excessive red tape in Australia as an issue, as it implores the go...