The Australian Financial Complaints Authority (AFCA) says a tool developed by the Insurance Council of Australia (ICA) to deal with COVID-related business interruption claims will help reduce disputes and speed clearance of a backlog of cases.

AFCA had received 299 complaints relating to business interruption claims arising from the pandemic as of November 1 and will continue work to resolve the disputes once the final outcome of the second industry test case is known.

At the same time, insurers may receive new claims which need to be processed and may need to review claims previously made to ensure outcomes are consistent with the test case decision.

AFCA and organisations including regulators have encouraged ICA to develop a mechanism to ensure the claims are handled fairly, consistently and efficiently, it says in a submission to the Australian Competition and Consumer Commission (ACCC).

The ACCC last week granted authorisation for insurers to use ICA’s shared web-based DSpark Tool, which aims to provide an easy method to search for the location of COVID-19 cases and public health orders that are relevant to claims.

“AFCA has supported, and continues to support, the development of the DSpark Tool,” it says. “The new mechanism is required urgently.”

Information collated by the tool will also be made available by insurers to insureds to assist them with their claims, the ACCC decision says.

“Interim authorisation will allow participating members to test and develop the DSpark Tool with the aim of having it fully available for use when the BI test case is determined, expected by the end of 2021 or shortly thereafter,” the ACCC says.