The Insurance Council of Australia (ICA) will consult with its members over proposed measures, including introduction of sanctions, to improve the voluntary Motor Vehicle Insurance and Repair Industry Code of Conduct. 
 
An independent review of code released its findings last week, making a total of 15 recommendations to improve governance and customer outcomes. 
 
The code commenced in 2006 and is jointly overseen by the ICA and Motor Trades Association of Australia. 
 
ICA says the report presents a number of recommendations to improve dispute resolution processes, promote awareness and accessibility, enhance compliance and formalise governance of the code, drawing on best practices found in other industry codes.  
 
“The report also calls out the need for the [code] to address increasing adoption of artificial intelligence in motor vehicle insurance assessment processes,” the ICA says. 
 
“The ICA will engage with its members to review the recommendations, with a view to ensuring that the [code] continues to achieve its objectives of promoting transparent, informed, effective and co-operative relationships between insurers and repairers.” 
 
The review says motor vehicle repairs make up the largest proportion of insurance claims from Australian consumers. In the retail insurance line there were 1.76 million smash claims made in the 2020/21 financial year, representing 45% of the total 3.9 million claims made by consumers nationally. 
 
“Since much smash repair work is performed by repairers and paid for through insurance, there is often a marked imbalance in power between some parties,” the report says. 
 
“Consumers are also important, but often do not have a direct contractual relationship with the repairers.” 
 
According to the report a “substantial” current weakness of the code is the lack of penalties for failure to comply with its provisions, and its inability to prevent “undesirable” parties from joining. 
 
“As such, there is currently no capacity to sanction signatories who refuse to do what they are required to under the code,” the report says. 
 
Click here for more from the report.