NIBA disputes dispute resolution cap
NIBA has opposed the corporate regulator’s proposal to impose uniform dispute resolution services and raise the compensation limit by 280%.
The association has tabled a submission in response to a consultation paper – Dispute resolution – review of RG139 and RG165 – by the Australian Securities and Investments Commission (ASIC).
ASIC says the functions of external dispute resolution schemes should be standardised, but NIBA says existing individual resolution schemes work well because they are tailored to meet the needs of different sectors.
“Insurance brokers are significantly different to many other people and organisations that are regulated by ASIC,” the submission says.
NIBA is concerned that ASIC is proposing a minimum $280,000 compensation cap on dispute resolution schemes. The current cap for Insurance Brokers Disputes Limited (IBD) is $100,000.
The broking body claims members’ professional indemnity insurers are not prepared to underwrite the increased risk.
NIBA cited IBD statistics to support its submission. The numbers reveal just five of 100 disputes ruled in favour of the disputant last year, while two cases reached compromise settlements.
The association has tabled a submission in response to a consultation paper – Dispute resolution – review of RG139 and RG165 – by the Australian Securities and Investments Commission (ASIC).
ASIC says the functions of external dispute resolution schemes should be standardised, but NIBA says existing individual resolution schemes work well because they are tailored to meet the needs of different sectors.
“Insurance brokers are significantly different to many other people and organisations that are regulated by ASIC,” the submission says.
NIBA is concerned that ASIC is proposing a minimum $280,000 compensation cap on dispute resolution schemes. The current cap for Insurance Brokers Disputes Limited (IBD) is $100,000.
The broking body claims members’ professional indemnity insurers are not prepared to underwrite the increased risk.
NIBA cited IBD statistics to support its submission. The numbers reveal just five of 100 disputes ruled in favour of the disputant last year, while two cases reached compromise settlements.