The Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission (ASIC) have published a series of documents and an online tool for life insurance policy-holders to compare providers’ claims handling and disputes.
The project is two years’ of work to collect and publish more meaningful data about the life insurance industry. Consumers can review the performance of an insurer, and compare to others. The purpose of the new documents is to increase the levels of trust in financial services and providers.
Two types of publications are being released, which together form the approach to the communication of this data.
APRA’s Life Insurance Claims and Disputes Statistics - a suite of industry and insurer-level data across a range of dimensions from 20 insurers and 22,000 data points
ASIC’s Life Insurance claims comparison tool - for consumers to compare metrics between providers, including claims acceptance rates, average claim time, number of claims-related disputes, and policy cancellation times
Eighty-three per cent of claims received were finalised
Of that 83 per cent, 92 per cent of were accepted and paid in the first instance
In 2017 there were 27 per cent of claims being ‘undetermined’, while in 2018 this was down to 13 per cent
Wait and resolution times vary significantly across providers (for death claims, AMP eight months, Westpac three months, TAL and AIA Australia four weeks)
TPD claim resolutions were also varied (Suncorp and Asteron almost 10 months, Westpac eight months, AIA Australia seven months)
Disability income insurance claims were slightly quicker (AMP three months, AIA Australia and ANZ both two months)
Disputes take a long time to resolve, with Hannover Re taking 17 months on average to resolve two death claim disputes, while AIA Australia took an average of six months to resolve 14 disputes, and TPD claims were a waiting game at Hannover Re (nine months), ANZ OnePath eight months, and AIA Australia seven months
Disability income insurance disputes were maxed out by TAL, who took an average of nine months to resolve
Individuals who were under financial adviser support had higher admittance rates than non-advised for the same cover