The General Insurance Code of Practice is to undergo its biggest overhaul since its inception in 1994.

The review, which was brought forward by a year because of last year’s natural disasters, comes amid unprecedented political interest in insurance standards and practices, with five major government reports on the industry released in the lead-up to it.

Against this backdrop, independent reviewer Ian Enright has conducted a particularly thorough analysis and poses many complex and difficult questions relating to all aspects of the code.

He has raised 110 questions on 17 key issues, which are now out for industry and stakeholder comments.

A primary area of concern is awareness of the code – namely, whether it is adequately promoted within and outside the insurance industry.

Another fundamental issue identified by Mr Enright is the code’s coverage. It currently applies only to those general insurers who choose to adopt it. The review sensibly asks whether the code should be compulsory for all insurers operating in Australia.

Mr Enright identifies a number of issues relating to the buying of insurance, following criticisms by several of the government reports.

He asks whether the code’s standards on selling are adequate and if it should contain standards for retail product simplification and phone and internet sales.

And he floats the idea of separate standards dealing with financial hardship cases, asking whether a requirement for insurers to offer Centrepay as a payment option should be introduced.

Claims handling drew major criticism after the disasters, so it is no surprise this area is under significant scrutiny in the review. The Insurance Council of Australia introduced several updates to claims assessment times in the code earlier this year, but the review seeks further changes.

It asks whether claims not determined within the prescribed four-month period should automatically be progressed to internal dispute resolution, and if the timeframe for reopening a natural disaster claim should be extended from six to seven months.

There is a suggestion claims denial letters should be required to contain more descriptive details on the basis for a decision, and that claims-handling standards should be more prescriptive for each stage of the process.

Perhaps most significant are issues surrounding what happens when things go wrong; a tightening of clauses surrounding complaints and internal dispute resolution processes is on the agenda.

Of course, tightening will mean little unless there are stringent standards in place to monitor compliance and investigate non-compliance – with serious consequences for the latter.

To this end, Mr Enright questions whether the code compliance committee should have greater powers – namely, to carry out all investigations into breach allegations. He also floats the idea of reports naming code participants under investigation.

Once non-compliance has been established, Mr Enright asks whether a wider range of sanctions, such as compensation, should be introduced.

He also asks if measures should be introduced to deal with allegations from the House of Representatives inquiry into last year’s floods: that code sanctions are minimal and not applied; that insurers do not rigorously enforce the code; that many employees are unaware of the code’s importance; and that many insurers have not established and maintained systems to enable its proper implementation.

Any measures to improve code compliance and underscore the seriousness of failing to comply would be welcome. Without these, the code – no matter how lengthy and prescriptive – is not worth the paper it is written on.