An independent investigation has found significant claims and complaints handling breaches of the Life Insurance Code of Practice.

Nearly 45% of the alleged breaches reported by a plaintiff law firm in February 2018 found code subscribers did not comply with the conduct and practices guidelines.

The Life Code Compliance Committee, in charge of monitoring subscriber compliance, launched the review after Maurice Blackburn submitted that there were 701 alleged breaches of the code.

“In all, the committee’s review found that 315 out of the 701 alleged breaches amounted to breaches of the code,” the committee says in a report.

“Of concern to the committee is that a substantial number of these were only identified as a result of the bulk referral, clearly indicating that many subscribers lacked robust frameworks for monitoring compliance with … the code.

“In addition, in most cases subscribers had not reviewed or improved their frameworks until the committee undertook its review.”

The code is owned by the Financial Services Council and came into effect in July 2017 with the aim of improving service standards across the under-fire industry.

It sets out a framework for principles of conduct, requiring insurers to be “open, fair and honest” in their dealings with consumers.

But the conduct and practices of the 11 code subscribers has left the committee alarmed.

The committee says most subscribers failed to respond to its request for more information in relation to the alleged breaches.

The committee was forced to write directly to the companies’ CEOs last August to provide the required information.

“Initial responsiveness to the committee’s enquiries was generally poor and remediation has not been proactive,” the committee says.

While the subscribers have started the necessary remedial works, the committee says “it has taken far too long and is largely only occurring as a result of the review rather than the subscribers’ desire to ensure they comply with the code”.

“Subscribers must take their code compliance far more seriously than they have to date. Compliance monitoring must be prioritised, ongoing and systematic.”