Income Insurance Online :: News
SHARE

Share this news item!

Insurer Compensates Claimants in Wake of Transition Issues

Insurer Compensates Claimants in Wake of Transition Issues

Insurer Compensates Claimants in Wake of Transition Issues?w=400

The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.

On September 2, 2024, an insurer has been mandated to compensate over 900 policyholders due to its failure to adhere to claims processing time frames outlined in the Life Insurance Code of Practice.

The Life Code Compliance Committee reported that the insurer failed to meet the necessary timelines for handling claims, resulting in 3580 breaches between November 2022 and August last year. This failure predominantly affected policyholders with income protection and total permanent disability coverage from a superannuation fund.

The issue arose following the insurer and the fund's decision to transfer claims processing responsibilities from a third-party service provider back to the insurer. The transition period saw numerous staffing issues at the third-party organization, which critically hampered its ability to meet the code's stipulated time frames for claims processing, the committee's investigation revealed.

The committee's findings indicated that the insurer violated several provisions of the claims handling process defined in the code. Specifically, the insurer failed to:

  • Inform customers about the claims process within 10 business days;
  • Provide updates on the progress of claims every 20 working days;
  • Notify customers in advance when their income protection claim payments were nearing their end.

 

"Insurers must ensure their change management plans allocate adequate resources to meet service standards and prescribed time frames," the determination stated. "Utilizing effective risk mitigation strategies is crucial in countering potential issues, thereby protecting against disruptions and safeguarding customer interests during transitions."

Post-transition, the insurer took over claims management on July 1 of the previous year and initiated several steps to bolster compliance with the code. The company formed new teams and conducted training focusing on code requirements and system utilization.

"The insurer has augmented its oversight of claims processing by increasing case conferencing, setting up weekly performance tracking, and holding monthly governance meetings," the determination noted. "These improvements led to noticeable increases in compliance rates regarding time frame obligations, which became more stable starting in December."

These measures indicate significant shifts in how the insurer manages and processes claims, fostering better service standards and accountability.

Published:Wednesday, 4th Sep 2024
Source: Paige Estritori

Please Note: If this information affects you, seek advice from a licensed professional.

Share this news item:

Insurance News

Australian Super's Claim Delays Raise Concerns Among Members
Australian Super's Claim Delays Raise Concerns Among Members
03 Jan 2026: Paige Estritori
Australian Super, one of the nation's largest superannuation funds, is facing criticism over significant delays in processing insurance claims, particularly those related to income protection and total and permanent disability (TPD). Members have reported prolonged waiting periods, leading to financial hardships and uncertainty. - read more
Club Marine Revamps Commercial Boat Insurance Policies
Club Marine Revamps Commercial Boat Insurance Policies
03 Jan 2026: Paige Estritori
Club Marine, Australia's leading provider of recreational boat insurance, has announced significant enhancements to its commercial boat insurance offerings. This strategic move aims to better align commercial policies with the company's recreational insurance products, providing comprehensive coverage for vessels used in both business operations and occasional leisure activities. - read more
Marsh Secures Role in Royal Australian Navy's Maritime Insurance Program
Marsh Secures Role in Royal Australian Navy's Maritime Insurance Program
03 Jan 2026: Paige Estritori
Marsh, a leading global insurance broker and risk advisor, has been appointed by the Australian Government to oversee the insurance and risk advisory components of the Royal Australian Navy's Maritime Insurance Program (MIP). This program is integral to the Navy's extensive fleet expansion and infrastructure development initiatives. - read more
Australian Insurers Achieve Significant Profit Growth Amid Rising Premiums
Australian Insurers Achieve Significant Profit Growth Amid Rising Premiums
03 Jan 2026: Paige Estritori
Australia's insurance industry has reported an after-tax profit of $6.1 billion for 2024, a substantial increase from the five-year average of $2 billion, according to KPMG's annual review. This surge is attributed to premium hikes and a year with fewer significant weather events. - read more
Rising Insurance Risk Pressures Challenge Australian Businesses
Rising Insurance Risk Pressures Challenge Australian Businesses
03 Jan 2026: Paige Estritori
Australian businesses are confronting heightened insurance risk pressures stemming from increased litigation, technological advancements, supply chain disruptions, catastrophic events, and geopolitical tensions. A recent report from Gallagher underscores the importance of risk insights and awareness for organizations preparing for insurance renewals. - read more
Click for more Insurance News


Life Insurance Articles

Finding Accidental Coverage When Comprehensive Income Protection Isn't an Option
Finding Accidental Coverage When Comprehensive Income Protection Isn't an Option
Income protection is an integral part of maintaining your financial security, especially in the event that unforeseen illnesses or injuries prevent you from working. Enabling you to receive a percentage of your regular income, this type of insurance provides a safety net, ensuring that you can continue to cover your living expenses and financial obligations whilst recovering. - read more
How to Compare Income Protection Policies When You Have a Medical History
How to Compare Income Protection Policies When You Have a Medical History
In today's ever-changing world, financial security is a cornerstone of peace of mind, particularly for Australians grappling with medical histories. Income protection insurance emerges as a pivotal solution, safeguarding not only the individual’s fiscal health but the well-being of their dependents. This introduction explores the nuances of income protection insurance and its particular significance for those with pre-existing medical conditions. - read more
Income Protection Insurance Explained: Ensure Your Livelihood in Times of Uncertainty
Income Protection Insurance Explained: Ensure Your Livelihood in Times of Uncertainty
When life takes an unexpected turn, whether due to illness, injury, or other unforeseen events, the financial repercussions can be devastating. This is where income protection insurance becomes an essential component of maintaining financial stability. Income protection insurance acts as a safety net, ensuring that even in times of hardship, your financial obligations can be met, and your standard of living maintained. - read more
From Illness to Injury: Understanding the Scope of Income Protection Insurance
From Illness to Injury: Understanding the Scope of Income Protection Insurance
In the uncertain times we face today, where both health and economic climates are unpredictable, safeguarding your financial stability becomes paramount. This is where income protection insurance steps in as an essential safety net. For many Australian families, it's the buffer that ensures life's financial commitments are met, even when ability to work is compromised. - read more
How to Avoid Common Mistakes When Filing an Insurance Claim
How to Avoid Common Mistakes When Filing an Insurance Claim
Filing an insurance claim in Australia can be a daunting process, especially if you are not familiar with the necessary steps and requirements. Claiming insurance is crucial when you need financial support, whether due to a natural disaster, accident, or another unexpected event. - read more


Start Here

Monthly Income Benefit:
Postcode:

All quotes are provided free and without obligation by a Specialist from our National Broker referral panel. See our Privacy Statement for more details.


Knowledgebase
Insurance Deductible:
the amount that an insured is required to contribute toward an insurance claim as stipulated in an insurance policy. Otherwise known as the "policy excess".

Quick Links: | Income Insurance | Income Protection Insurance | Income Insurance For Self-employed | Income Insurance Quotes | Best Income Insurance Australia | Income Insurance For Employees | Income Insurance Comparison | Income Protection For Contractors | Temporary Income Protection | Income Replacement Insurance | Income Protection Policy
This website is owned and operated by Clark Family Pty Ltd (ACN 010 281 008) as Trustee for the Clark Family Trust (ABN 35 957 893 714), 43 Larch Street Tallebudgera QLD 4228. Clark Family Pty Ltd is an Authorised Representative (AR 1298860) of Unique Group Broker Services Pty Ltd (AFSL 509434) for financial product referrals and an Authorised Credit Representative (ACR 401491) of Saccasan Pty Ltd (ACL 386297). Check our licensing details on the ASIC registers: Clark Family Pty Ltd ACR, Clark Family Pty Ltd AR, Saccasan Pty Ltd, Unique Group Broker Services.
IMPORTANT: We do not provide financial product advice or credit assistance. We act solely as an introducer and refer enquiries to licensed third-party intermediaries, insurers, and lenders - with whom you can then deal directly. We may receive a fee or commission from these third parties in consideration for the referral. Before any action is taken to obtain a product or service referred to by this website, advice should be obtained (from either the third party to whom we refer you or from another qualified intermediary) as to the appropriateness of obtaining those products having regard to your objectives, financial situation and needs. Whilst we have our own process for validating the legitimacy of our referral partners, you should always verify the credentials of your financial adviser before proceeding with recommendations that they may present. Visit the ASIC website for further information.