The Australian Financial Complaints Authority says too many complaints that should be resolved at the company level are ending up with the external ombudsman scheme.

AFCA received 104,861 complaints across all the sectors it covers last financial year, which is more than double levels under predecessor schemes. Some 29,335 concerned general insurance.

“If you think about why we exist, we’re there to help to bring resolution to really sticky and complex disputes where they can’t be resolved between the parties,” COO Justin Untersteiner said. “What we shouldn’t be dealing with is the everyday stuff.”

Mr Untersteiner told a member forum last week that claims handling has remained a driver of “very, very high” general insurance complaints and is an example of where issues could be resolved before reaching the ombudsman. 

“I don’t see that AFCA is the place to add a great deal of value in dealing with the dispute around a claim handling delay, and often when they are resolved, it’s through an apology or a small amount of non-financial loss compensation that could have been dealt with at the firm level,” he said.

“We think there is a great opportunity for firms to ... resolve things earlier and not come to AFCA.” 

Delays in claim handling accounted for 7470 complaints last financial year, ahead of 5563 for claim amounts, 3762 for claim denials and 3276 for denials related to an exclusion or condition.

A total of 10,204 claims were received about comprehensive motor vehicle cover and 7358 about home building policies.

AFCA executives, when asked if the service is looking at its own processes to quickly close complaints that lack merit, said changes have been made to address the issue, including where a business has made an offer that looks fair and reasonable. 

But Mr Untersteiner said it is a balancing act and AFCA cannot “prima facie” accept a view that a complaint lacks merit, and it needs evidence.

“Otherwise, I think there is a different kind of integrity issue in the system,” he said. “What’s important there for us is making sure we’re not excluding complaints that actually do have merit, just because maybe a consumer hasn’t articulated their issue properly, or otherwise.”

The forum’s general insurance session heard AFCA is receiving complaints from policyholders about “significant” premium increases of 60%-200%.

Lead ombudsman for insurance Emma Curtis said the organisation has limited jurisdiction in relation to premium increases, but the unusual size of some renewal rises is bringing related complaints.

“These are the ones more likely to come to us as a complaint, because there’s that bill shock element to it. This is a very topical issue,” she said.

AFCA can only assess premium rise complaints when they involve an allegation of non-disclosure misrepresentation or breach of a legal obligation, or if there is a specific exception in relation to medical indemnity insurance products.  

Ms Curtis encouraged insurers to be transparent about the reasons for increases, and said the more explanation given, the more likely an insurer will win a dispute.

“If there are these significant increases, the more that you can explain to your customers why, the better,” she said. “There may be factors specific to that particular complainant, or there may be more general factors across the district or the area, or indeed the economy. The key thing is to give us a really good explanation of why there has been a premium increase.”

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