The top 5 insurance disputes and how to resolve a complaint

Australian Financial Complaints Authority is a not-for-profit independent body working with consumers, small businesses and industry to resolve and reduce financial disputes.

All Australian businesses with financial services licenses, including insurance brokers, are required to be a member of the Australian Financial Complaints Authority (AFCA) under their licence conditions.

AFCA handles consumer complaints for;

• Banking and finance
• Investments and advice (including financial planners)
• Superannuation
• Life insurance
• General insurance (including insurance brokers)

According to its 2019-2020 annual review*,  AFCA “received 80,546 complaints from consumers and small businesses from July 2019 to June 2020. It resolved 76,681 complaints with $258.6 million in compensation or refunds paid to consumers and small businesses.”

General insurance complaints accounted for 24% of all AFCA complaints. Some key statistics about these disputes include;

• 19,103 complaints received and 17,564 complaints closed
• 70% of complaints resolved by agreement, or in favour of complainants
• 46% were resolved at Registration and Referral stage
• 81% of AFCA licensee members had no complaints raised against them in this financial year.

The top five general insurance complaints received by-product were;

1. Motor vehicle – comprehensive,
2. Home – building,
3. Travel
4. Motor vehicle – uninsured third party, and
5. Home contents

The top five issues were;

1. delays in claim handling,
2. disputes over claim amount,
3. denial of claim –
4. disputing exclusions or conditions and
5. service quality

More than $62.6 million in compensation and refunds was awarded or obtained through AFCA’s dispute resolution work

General insurers received the highest number of general insurance complaints (15,568), followed by complaints against underwriting agencies (2,195).

Allsafe Insurance Brokers Pty Ltd is a member of the Australian Financial Complaints Authority (AFCA) but also strives to resolve all service disputes with its clients via an internal dispute process.

We take complaints seriously and we are here to help you with all your insurance needs.

Please feel free to contact  our management team if you require assistance

Jeff Moule                               Nathan Jameson

Director                                   Director

0421 934 784                          0412 888 486

SOURCE: 2019-20 AFCA Annual Review