A home contents insurance policyholder whose policy renewal was declined due to the number of claims she made will not be compensated after a dispute ruling determined that the insurer was entitled to follow its underwriting guidelines.

IAG provided the complainant with a letter dated December 8 last year, stating it would not be offering her an option to renew the policy, which was due to expire on January 14.

The insurer said its decision was determined by the woman’s “extensive claims history for this property” and provided her with information about finding another insurer.

The complainant contested the insurer’s decision, saying she was not advised regarding any limit to the number of claims she could make.

IAG provided the Australian Financial Complaints Authority (AFCA) with excerpts from its underwriting guidelines that stipulated policy renewals would be denied if the insured had three more or claims filed in the past 12 months, four or more in the past 24 months, or five or more in the past 36 months.

The complainant’s claim history showed that she had lodged eight claims since January 14 2019. Two of the claims that appeared on the list were not on a list of claims provided by the insurer’s underwriting teams.

AFCA said it was unsure why the claims were on one list and not the other but said without counting them, the insured’s claims history showed that the number of claims made exceeded IAG’s underwriting criteria.

It said the insurer acted accordingly with section 58 of the Insurance Contracts Act 1984 (Cth), which requires insurers to inform policyholders whether they are willing to renew at least 14 days before the policy’s expiry date, and determined that it was entitled to its decision.

The complainant said it took the insurer 83 days to provide her with a copy of her claims history and sought to be compensated for the delayed response.

The ruling acknowledged that the process did take too long but denied her bid for compensation, saying that the insurer handled the non-renewal “in line with good industry practice”.

“I am satisfied the complainant would have been aware of the approximate number (if not the exact number) of claims she had made over recent years,” AFCA said.

Click here for the ruling.