The industry dispute referee says it is receiving complaints from insurance policyholders about “significant” premium increases of 60%-200%. 

Australian Financial Complaints Authority lead ombudsman for insurance Emma Curtis says the organisation has limited jurisdiction in relation to premium increases, but the unusual size of some renewal rises is bringing related complaints.

“These are the ones more likely to come to us as a complaint, because there’s that bill shock element to it. This is a very topical issue,” she told a half-yearly general insurance member forum attended by insuranceNEWS.com.au and more than 300 participants.  

AFCA’s remit does not cover complaints about unaffordable premiums or those from policyholders “just generally dissatisfied with the increase”.  

It can only assess premium rise complaints when they involve an allegation of non-disclosure misrepresentation or breach of a legal obligation, or if there is a specific exception in relation to medical indemnity insurance products.  

“We don't have an unlimited jurisdiction. It’s really important to note that it is limited,” Ms Curtis said.

Her comments follow a policyholder winning a dispute and a reduction to their home and contents premium after Suncorp raised it more than 60% at renewal.

Ms Curtis encouraged insurers to be transparent about the reasons for premium increases, and said the more explanation given, the more likely an insurer will win a dispute.

“We have seen good examples where insurers have included a one-page explanation of why there’s been a significant premium increase.

“If there are these significant increases, the more that you can explain to your customers why, the better.

“There may be factors specific to that particular complainant, or there may be more general factors across the district or the area, or indeed the economy. The key thing is to give us a really good explanation of why there has been a premium increase.” 

Senior ombudsman Chris Liamos told the forum that setting out factors that have changed from one renewal to the next helps consumers understand, and also helps AFCA assess the matter. 

Problems can include incorrect application, Mr Liamos said, and if there is a disproportionate premium increase the insurer has not adequately explained, AFCA will look at that as “falling within that exception”.  

“I'd emphasise that as something that we’ve seen in the past and we’re seeing a little bit now,” he said.

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