The Insurance Law Service has told the federal government it needs $2.3 million a year to run its critical facility.

The service, organised by the Financial Rights Legal Centre, provides free advice and advocacy to consumers facing general and life insurance issues, and has responded to 77,500 calls since 2007. 

In a pre-budget submission, it says it is “vital that this work continues and that the skills and experience of our specialist solicitors is not lost.  

“Unfortunately, the small amount of recurrent funding the Insurance Law Service receives is inadequate.”

It says it is the only free, independent, national specialist insurance legal advice service, and in 2023-24 it received $1.9 million in funding but provided an estimated $13 million in value for its clients.

"Many of our casework clients are facing social and economic disadvantage. We assist consumers who have been mis-sold expensive, poor value insurance products like funeral insurance or accident insurance that deliver few benefits.

"There is significant unmet demand for expert independent legal advice and assistance on insurance."

The service has helped consumers obtain millions of dollars in refunded premiums, paid claims, ex-gratia payments and compensation. It has also worked closely with the insurance sector to improve performance and supported the work of regulators.

The submission contains letters of support from the Australian Financial Complaints Authority, the Australian Securities and Investments Commission and the Insurance Council of Australia.

The service says the government should provide funding certainty for at least five years as part of the budget, expected to be delivered on Tuesday.

“Financial Rights needs direct Attorney-General’s Department funding of $2.3 million annually to run an effective Insurance Law Service,” the submission says.

“This funding must be recurrent to allow for the recruitment and retention of specialised insurance solicitors and policy experts.

“Without adequate ongoing funding from 2025, the national service will be lost.”