Insurers have labelled as “scattergun” and “extremely disappointing” brokers’ allegations that poor claims experience is becoming more common in the industry.

As reported in insuranceNEWS.com.au last week, National Insurance Brokers Association (NIBA) CEO Dallas Booth says he has had “regular complaints” from brokers of claims going unpaid “for no apparent reason”, and alleging that obtaining explanations from insurers as to why claims are being mishandled is difficult.

(See earlier story).

He suggested this may be caused by “turmoil within the industry” that has seen insurers remove entire layers of management.

Insurers have fired back over the past week, with high-level executives telling insuranceNEWS.com.au the “generalised statements” from NIBA have caused them huge concern because the Hayne royal commission will turn its attention to general insurance this week.

“The timing could not have been worse,” according to one source who spoke on the understanding that his name would not be used.

“Presumably there is something behind the comments, but this scattergun approach seeks to tar the whole industry and could exacerbate unfounded stereotypes.

“When that sort of commentary comes from within the industry it is very disappointing. These are people with a responsibility to enhance the community perception of insurance, not undermine it.”

However, Insurance Brokers Network of Australia Chairman Gary Gribbin has joined the debate, supporting Mr Booth’s comments.

“Dallas is simply reflecting the sentiment of the vast majority of the general insurance broking community,” he told insuranceNEWS.com.au.

“It is undoubtedly the case that insurers are palpably mismanaging claims.

“There is a clear pattern of spurious, very technical denial, on top of which their administration of claims is nowadays abysmal.”

The Insurance Council of Australia (ICA) declined to discuss the allegations with insuranceNEWS.com.au, saying NIBA has not formally raised the issue with it.

See Analysis.