The Insurance Brokers Code Compliance Committee has explained what it expects from the profession after voicing concerns in the past over low or zero breaches from some broking subscribers. 

“Our call for improved breach reporting is not a call for more breaches,” a spokesperson told insuranceNEWS.com.au. “Rather, it is a call for more accurate, quality reporting practices that produce reliable data and a true reflection of compliance with the code. 

“We simply want to see a shift from under-reporting to quality reporting, and then, ultimately, to fewer breaches through better practices. We want to see better reporting, not more breaches.” 

The committee again pressed the need for brokers to do better after its annual data report, released last week, showed a 36% rise in reported breaches to 4642 for calendar year 2023. 

The number of brokers who reported zero breaches dropped to 138 from 175, and 127 that said they had no complaints included six with more than 30 staff. 

“The … annual report reveals a positive trend in reporting with an increase in the number of brokers reporting breaches and complaints,” the committee says. “This follows significant efforts throughout the year from [the committee] to encourage improvements from brokers. 

“However, despite these gains, a concerning number of brokers continue to report zero breaches or complaints, indicating there is still considerable work to be done.” 

The committee also called for improvements after a “significant increase” in breaches related to disclosure of remuneration. There were 106 such breaches last year, compared with 23 self-reported cases in 2022. 

“The data in our report should serve as a wake-up call,” committee chair Oscar Shub said. 

On the remuneration breaches, Mr Shub said the sharp rise "is a clear signal that brokers need to do better". 

Insurance Advisernet MD Shaun Standfield says the code committee’s criticism was “disappointing”, because the committee has in the past urged the profession to be more alert to breaches. 

The committee spokesperson says there is “no contradiction” between calling for better reporting and calling for brokers to address increases in reported breaches. 

He says the first step is ensuring brokers can identify their breaches and report them accurately and the second step is encouraging brokers to improve their practices to minimise breaches. 

“We have publicly called for brokers to improve their compliance frameworks and reporting practices to ensure they are reporting accurate data on breaches,” the spokesperson told insuranceNEWS.com.au.  

“Now, within the context of good compliance frameworks that reliably produce high quality, accurate reporting, we expect brokers to improve their practices to reduce breaches. 

“The call for a reduction in breaches is a call for better interactions and practices with clients.” 

Click here for the report.