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COVID-related delays 'concerning': ICA chief

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The Insurance Council of Australia (ICA) is “very worried” about the impact of COVID-related issues on claims turnaround, and is battling to make sure the problem does not worsen this disaster season.

Customers have highlighted claims delays following last year’s Halloween hailstorms in Queensland and Cyclone Seroja which struck WA in April.

According to ICA statistics 55% of the 6900 Seroja claims are closed, while 85% of the 44,000 Halloween hailstorm claims are closed.

ICA has held one-on-one forums for victims of both catastrophes who are facing issues with claims, and says delays are commonly caused by lack of materials and labour, or state border closures.

“It is one of the problems at the moment that we are very aware of and we’re talking actively with consumer groups and messaging as hard as we can that there is a COVID impact happening on how claims are managed,” ICA CEO Andrew Hall told insuranceNEWS.com.au.

“It is a concern and it’s something that we’re very worried about. It is incumbent upon the insurer to keep [communicating] with the consumers.

“But at the end of the day the situation is out of the control of everyone – lack of supplies, lack of trades, labour and the like, we need to make sure that consumers are aware that these are some of the factors.

“That has been the experience of late in a couple of areas where delays have occurred. Generally what we have found in almost all cases is that it is COVID related – the state border closures, supply chains.

“Although consumers may feel sometimes that that’s just an easy excuse in fact it is the reality.”

Mr Hall says ICA is continuing to lobby governments about the impact state border closures could have on claims handling as Australia enters disaster season.

ICA believes a national plan is necessary to enable insurance staff and assessors to move quickly across the country, or further delays to claims could occur.

“We have put forward a plan through the Federal Government and we are writing again to premiers about it,” Mr Hall said.

“As every week goes past, circumstances keep changing. Queensland’s announcement will be helpful once we get to December 17. But let’s hope between now and then [no disasters] happen.

“We are working very closely, particularly through the federal agencies, to get insurance workers and assessors included in these agreements and get protocols in place.”

Mr Hall was speaking in the week ICA launched its first advertising campaign to promote the new General Insurance Code of Practice. A series of short videos is being played across social media and on Sky News.

The new code includes a range of new commitments including sanctions for significant breaches of up to $100,000 in the form of community benefit payments.

“The revised code is a very demonstrable effort on behalf of insurers to build trust with their customer base and I think that it’s important that we amplify that,” Mr Hall said.

“If you read the code, one of the undertakings that the sector makes is that it will promote the code. Sky has got very good regional reach and it has an audience that is very attuned to current affairs.”

He says it’s too early to get feedback from the Code Governance Committee on how the new code, most of which came into effect in July, is bedding in.

“Insurers have worked very hard to meet these deadlines and this was with the backdrop of the very hectic period they’ve been through, and all the regulatory changes at the same time,” he said.

“It will be three to four months before we know how we’re meeting obligations under the new code.”

Mr Hall has now been in post for more than 12 months, having taken over from Rob Whelan in September last year, and he’s pleased with how it’s gone.

“I’ve loved it, and I like the highly practical nature of insurance and the ability that it has to put people back into a position that they were meant to be before something happened to them. That’s the piece that I really enjoy.

“It’s been an incredibly unusual year to live and work through. We’ve also had a number of issues on the go, and while you would prefer smooth sailing, the issues do give you the opportunity to really get to know and work with members and see the best that insurers are trying to do for their customers at all times.

“It’s definitely been a fascinating period and I’m pleased that while we’ve had a number of catastrophes, we’ve not had a really major one like some of the events of the last decade.

“I’m grateful to have had at least 12 months to get a feel for it before we go through a really large event, which I’m sure is a case of when not if.”

A highlight was last week’s Annual Industry Forum, which made a return after a COVID-enforced absence of two-and-a-half years.

“More than 300 people registered for it which is more than for any of the physical forums we’ve ever done,” Mr Hall said.

“The online format provides a good deal of flexibility for attendees to hear what’s relevant to them without the need for travel.

“We are very well aware though that you miss out on the networking. Next year we will probably continue with online forums but we’ll find other events where we can generate the networking and collaboration that are really beneficial for the industry.”