A life insurance firm in Australia breached the country’s Life Insurance Code of Practice 3,580 times over a 10-month period.
In its latest notice of determination Australia’s Life Code Compliance Committee (LCCC) says it found the un-named life insurer failed to:
- Tell customers about the claim process within 10 business days of it being notified of the claim
- Tell customers about the progress of their claims at least every 20 business days and to respond to requests within 10 business days
- Tell customers about the claims decision within 10 business days (2023 Code) or 15 business days (2016 Code) of receiving all necessary information
- Make a decision on customers’ claims within two months for income protection claims and six months for lump sum claims
- Tell customers in advance that their income protection claim payments were coming to an end
The committee says the insurer reported 3,580 breaches of the claim-handling obligations between 1 November 2022 and 31 August 2023.
It attributed the breaches “…to resourcing issues while transitioning certain claims-handling operations from a third-party service provider between November 2022 and July 2023″.
To remediate and rectify the breach, the insurer:
- Set up new teams for claims-handling, provided training on Code obligations, and established key performance indicators for staff
- Committed to financially compensating 942 claimants by 31 October 2024
Click here to view the committee’s full determination.