The General Insurance Code of Practice: what insurers commit to

What the Code is

The General Insurance Code of Practice is a document published by the Insurance Council of Australia (ICA). General insurers choose to adopt the Code by subscribing to it.

Subscribing insurers are required to adhere to the Code’s requirements in their interactions with customers who purchase general insurance products. This obligation extends to both individual consumers and small business customers.

The Code outlines specific commitments across several key areas, including how insurers conduct sales, manage claims, respond to financial hardship situations, support vulnerable customers, and handle complaints.

What the Code covers

The General Insurance Code of Practice outlines commitments made by participating insurers across several key areas of their operations. These commitments aim to ensure consistent standards of conduct and consumer protection. The Code addresses how insurers interact with customers, from the point of sale through to claims handling and beyond.

Specifically, the Code covers sales practices, requiring insurers to provide clear and accurate policy information. It also mandates training for staff and authorised representatives and a commitment to fair treatment of customers. Regarding claims, the Code establishes timeframes for decisions, outlines requirements for customer contact, and mandates written reasons for claim declines, alongside accessible dispute resolution pathways.

Furthermore, the Code addresses financial hardship, vulnerability, and complaints. Insurers commit to fast-track relief for customers experiencing defined financial hardship, alongside payment plan and stop-collection options. The Code also requires training to recognise vulnerability and provides support pathways, including for those experiencing domestic and family violence. All complaints are governed by ASIC Regulatory Guide 271, with the right to escalate to AFCA.

Code Governance Committee

The Code Governance Committee (CGC) provides independent oversight of subscribing insurers’ adherence to the General Insurance Code of Practice. It functions as a monitoring body, assessing how well insurers uphold their commitments.

The CGC’s responsibilities include investigating potential breaches of the Code. It also publishes data and case studies relating to compliance, and publicly names insurers found to be in breach within its reports. Sanctions may be applied to address breaches.

The CGC’s work has demonstrably influenced the insurance industry, contributing to improvements in claims handling, hardship support, and vulnerability response practices.

Customer remedies

The General Insurance Code of Practice outlines pathways for customers seeking resolution to issues. Customers initially engage with the insurer through its internal dispute resolution process. This process is managed in accordance with ASIC Regulatory Guide 271.

If a customer remains dissatisfied after utilising the insurer’s internal process, they have the option of escalating the complaint to the Australian Financial Complaints Authority (AFCA). AFCA has the authority to consider breaches of the Code when making determinations.

Customers may also report potential Code breaches directly to the Code Governance Committee for review and oversight.