Home / Local / Insurers fail to implement 'public-facing' code obligations on time
20 June 2022
A review of public-facing obligations included in the latest version of the General Insurance Code of Practice found only 29% of insurers surveyed complied with all five requirements by the deadline.
The code demands subscribers have a range of information publicly available, usually on the subscriber’s website.
This includes information on making sure products are aimed at appropriate target markets, access to home building sum insured calculators, information about financial hardship support, avenues for complaints, and information about the code itself.
The General Insurance Code Governance Committee surveyed 14 insurers and found only four of them had complied with all five public-facing obligations.
Six of the subscribers failed to provide the information on the code in time, and four failed to supply the information on financial hardship. Small and medium-size subscribers accounted for most of the failures.
However, all of the surveyed subscribers that offer home insurance had provided the sum insured calculator by the deadline.
The committee is assessing whether the failures amount to significant breaches, and has already confirmed at least one.
“The committee reminds code subscribers under the 2020 Code it may impose one or more sanctions on a code subscriber for a breach of the code or for a significant breach of the code,” the report says.
The code says insurers that significantly breach the code can be forced to publish the fact, compensate any losses, and pay a community benefit penalty of up to $100,000.
The committee’s report notes that the deadlines, in July and October last year, coincided with “significant regulatory and legislative change”.
“The committee is therefore not surprised that larger code subscribers with greater resourcing and systems capabilities were able to meet the implementation deadlines more easily,” the report says.
The Insurance Council of Australia (ICA) welcomed the report.
“We look forward to exploring the report’s insights and learnings with members including accessibility of information,” a spokesperson told insuranceNEWS.com.au.
“We note the findings in relation to implementation timeframes, and appreciate the acknowledgement of the challenges and pressures facing the industry at that time.”
Click here to read the full report.