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Australian regulators publish life insurers' claims handling data

BIScom Subsection: 
Editorial Staff

How does your life insurance company compare to others when it comes to handling claims? Now, if you are in Australia, the Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission (ASIC) have produced data comparing insurance companies' performance and launched a tool to help policyholders make comparisons.

The joint project is the culmination of more than two years' work aimed at collecting and publishing higher-quality, more consistent and transparent data about the life insurance industry. It enables the community to review an individual life insurer’s claims and disputes results and compare them with other providers. The data release signifies a new level of transparency and accountability which the regulators see as essential to improving trust in financial services.

A series of publications reflect the agencies’ different roles, with APRA focused on protecting policyholders by ensuring the soundness and stability of institutions, and ASIC responsible for regulating conduct, disclosure and consumers. results.

There are more than 22,000 data points from 20 insurers including claims and disputes information across all cover types and distribution channels. The data was collected under APRA’s new reporting standard LRS 750 Claims and Disputes, which came into effect in October 2018.

The data shows that 92 per cent of overall claims are paid in the first instance, and breaks down consumers/ results according to type of cover and distribution channels.

ASIC Commissioner Sean Hughes said: "The online tool compares insurers on four metrics – the percentage of claims accepted, the length of time taken to pay claims, the number of disputes and the policy cancellation rates."

In addition, ACCC's MoneySmart now provides a life insurance calculator to help consumers decide whether they need life cover and, if so, now much.

For example, the tool returns "If you have no partner, children or other people who depend on you financially, you may not need life insurance. However, as a single person, you might need income protection or total and permanent disability cover to help you manage your expenses if you get sick or seriously injured."