Vastavam web: Australia’s life insurers will be required to publish customer dispute numbers every six months, top financial regulators said on Wednesday, as a misconduct inquiry threatens other reforms that could hurt industry profitability. For the first time, customers will be able to see comparable dispute and claims data of each insurer, helping to make better choices, the Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission (ASIC) said.
“The introduction of a legally binding reporting standard will improve the consistency and reliability of the data we receive,” APRA member Geoff Summerhayes said in a statement. The new standardized claims data would help the regulators identify emerging problems in the industry, said ASIC’s deputy chairman, Peter Kell.
Last month, the government-ordered investigation exposed how some of the largest insurers, including Australian units of multinationals, may have broken laws – some of which carry criminal penalties. The inquiry is considering whether laws should be strengthened to protect consumers amid evidence of rampant misconduct, including poor handling of insurance claims, inappropriate selling techniques and use of outdated medical definitions to avoid claim payouts.
On Wednesday, credit agency S&P Global Ratings said the prospect of legislative changes amid the inquiry’s revelations of poor claims handling could hurt the profitability of insurers in Australia. “There are prospects of legislative changes affecting group business that threaten to further erode margins,” said credit analyst Mark Legge. “All these challenges reinforce the negative trend we see for the sector.”