The corporate regulator says consumers were not interviewed as part of its investigation into CommInsure, believing it was unnecessary in determining if there were any legal breaches.
Speaking to the media yesterday, ASIC deputy chair Peter Kell said determining if there were any breaches of the law was the primary objective of its investigation.
“If you look at ASIC's industry-wide report on insurance claims handling that we released late last year, it set out more than 20 consumer case studies in that report,” Mr Kell said.
“We speak directly to consumers on a very regular basis, but it's not unusual as part of the formal investigation that there isn't a requirement for consumers to be interviewed, and we make that decision based on the facts before us and the nature of the allegations and the relevant law.”
Mr Kell noted in ASIC’s investigation of its ruling that having out-of-date medical definitions is not against the law.
In addition, he said ASIC is calling for the removal of legal exemptions that currently exist around claims handling within the life insurance industry.
Mr Kell said claims handling is specifically excluded from financial services consumer protection law under the Corporations Act, and that this also stretches to consumer experiences of a claim.
“The government has agreed to look at law reform for life insurance claims,” he said.
“As we have set out very clearly in relation to this matter in our report and more broadly for the industry, the legal exemptions that this industry currently enjoys for claims handling, in ASIC's view, should be removed.”
In response to the findings, CommInsure said in a statement that ASIC's report established that various improvements have been made in its business over the past year.
"We will be examining the findings closely as we always know we can do more to enhance the customer experience," CommInsure said.
"We recognise the industry is evolving and we expect, and will advocate for, further industry reform to make life insurance simpler and better for customers."
Adrian Flores is a deputy editor at Momentum Media, focusing mainly on banking, wealth management and financial services. He has also written for Public Accountant, Accountants Daily and The CEO Magazine.
You can contact him on [email protected].
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