Committee Deputy Chairman Andrew Leigh asserts that "pretty much no-one" is reading insurance documentation and says "we've just got to go full standardisation haven't we?"

Mr Locke says AFCA's role is not to develop policy. But he says where standard definitions exist, as in flood, it has been "incredibly helpful".

Mr Price says the reality is that people don't understand what they're insured for.

"Current disclosure arrangements are failing not only consumers but also the industry."

A standard definition of fire would make it easier and limit dispute numbers, Mr Price says.

AFCA is due to be reviewed after 18 months, which would be next month, Mr Locke confirms.