Life insurers ‘decline 8% of claims’
Life insurers admitted 92% of finalised claims last year and declined about 8%, according to pilot industry data released by the Australian Prudential Regulation Authority (APRA) and Australian Securities and Investments Commission (ASIC).
The regulators are developing the data collection to improve public reporting on the sector’s claims performance.
“Significant progress has been made to date on this initiative to develop a consistent public reporting regime for claims data and claims outcomes, which will improve transparency and accountability in the life insurance industry,” APRA Member Geoff Summerhayes said.
The data shows 126,300 claims were reported last year, with 103,100 finalised and 6400 withdrawn.
Admitted claims totalled 95,000, and there were 8100 declined claims.
There were 4400 disputes lodged, with some likely to relate to claims reported and finalised before last year.
ASIC and APRA have also released a paper providing feedback on common data quality issues and outlining plans for a second round of the pilot. The regulators say the project marks the first time common definitions have been formalised across the industry.
“We are now focusing on the ability of insurers to report according to these common definitions, including how they can do their best to manage system constraints,” Mr Summerhayes said.
“While significant progress has been made, there is more work to be done to fully embed the definitions across the industry.”
ASIC and APRA say meaningful comparisons are difficult due to a wide range of differing systems, products and processes, including varying definitions for reported, declined or withdrawn claims.