The Insurance Council of Australia (ICA) is midway through a two-year program to improve consumer understanding of products, according to a submission to the Productivity Commission.

The independent Effective Disclosure Taskforce, appointed by ICA, has proposed 16 ways to enhance the disclosure framework, all of which have been taken up by the industry body and are now being implemented.

These include shifting from a minimum mandated disclosure approach to best practice transparency, and exploring new forms of electronic disclosure.

“All these initiatives are aimed at better equipping consumers to consider their insurance needs, and to make it simpler for consumers to choose an appropriate policy,” the ICA submission says.

“Better assisting consumers to assess and compare policies on their coverage will stimulate deeper competition based on product features and not just price.”

The commission is reviewing competition in the financial system and its final report will be delivered to the Government by July 1 next year.

A submission from the Australian Prudential Regulation Authority says the industry has become increasingly concentrated in the past 10 years, due mainly to acquisitions.

In June, about 55% of industry-wide gross written premium was with the five largest insurers, up from 42% in 2007, it says. The five biggest players accounted for 80% or more of the market for household insurance, domestic motor and travel cover.