A new Insurance Council of Australia (ICA) industry survey shows people are confident about the financial strength of insurers and their ability to pay claims, despite recent market volatility caused by the collapse of HIH and September 11. But other survey results show the industry still has a lot to do in building consumer confidence.

Speaking at ICA’s NSW state conference on Friday, Executive Director Alan Mason said the results of the survey of consumers and business opinions of insurance were encouraging, despite the industry’s recent troubles. He said the introduction of the Australian Prudential Regulation Authority’s “more onerous” solvency rules, and its requirement that every insurer seek a new licence, have assisted insurers.

The ICA survey, which has tracked consumer attitudes throughout much of the past 10 years, shows some remarkable contradictions in people’s thinking. For example, 95% of consumers consider insurance important – despite one in four households not insuring their home and contents. And despite the perceived widespread acceptance of insurance fraud, 98% of consumers agree that those who commit the crime should be punished.

It seems the battle to rebuild the industry’s image as a responsive, consumer-conscious part of the community still has a fair way to go.

Mr Mason said consumers questioned for the survey gave the industry a “sobering” overall performance rating of 5.7 out of 10. “ICA will be putting resources into identifying the issues which drive the public’s perceptions over the coming year,” Mr Mason said. “In addition, we will soon be releasing for public discussion the latest draft of the new code of practice, which will form a key part of the industry’s relationship with consumers into the future.”

And now for the good news – more than 90% of the survey respondents were in favour of the industry’s dispute resolution schemes, considering them of “high importance”.