ASIC calls on insurers to enhance claims management practices
ASIC calls on insurers to enhance claims management practices | Insurance Business Australia
Insurance News
ASIC calls on insurers to enhance claims management practices
Reminder driven by impacts of severe weather events
Insurance News
By
Roxanne Libatique
The Australian Securities and Investments Commission (ASIC) has issued a formal reminder to the country’s general insurance sector, stressing the importance of refining their approach to managing insurance claims, particularly those stemming from severe weather conditions.
In its letter, ASIC highlighted the obligations of general insurers operating under the Australian financial services (AFS) licensing regime, with a strong emphasis on the need for these entities to conduct their operations with efficiency, honesty, and fairness, especially in the swift resolution of claims.
Severe weather events’ impact on claims process
The call to action is driven by the widespread impact of various severe weather events across Australia in recent years, which have prompted a significant number of Australians to file insurance claims as part of their recovery efforts.
ensuring clear and upfront communication with claimants
proficient management of interactions with third-party service providers
quick identification and addressing of complaints and expressions of dissatisfaction
sensitivity towards clients facing adverse circumstances
the allocation of adequate resources towards the processing of claims and the resolution of disputes
ASIC calls for improved claim management
The regulator has singled out the rectification of improper conduct in the area of insurance claim management as a focal point of its enforcement strategy for the current year.
Furthermore, ASIC is calling for a more robust response from the insurance industry to the severe weather challenges that have arisen during the current summer season. It is also pressing for an accelerated effort by insurers to clear the backlog of unresolved claims related to the flooding incidents of 2022, indicating a broader regulatory expectation for improved performance and consumer support in the aftermath of natural catastrophes.
“We expect the industry to continue action on the issues raised in REP 768, the Deloitte report, and the current House Standing Committee on Economics inquiry,” said ASIC commissioner Alan Kirkland in the letter. “We will seek updates on progress in addressing these issues in our regular discussions with the ICA and with individual insurers. We also expect the industry to consider these issues as part of the current review of the code.”
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