The next version of the Insurance Council of Australia (ICA) code of practice will make 30 recommendations to strengthen consumer protections and will for the first time seek Australian Securities and Investments Commission approval for the document.
“The revised code will reflect the general insurance industry’s commitment to positive outcomes for consumers and its determination to provide best practice in conduct and customer service,” CEO Rob Whelan said.
“The General Insurance Code of Practice was one of the first of its kind in Australia and the industry treats it with utmost respect and seriousness.”
The code review’s final report includes changes to better assist vulnerable consumers experiencing family violence, financial hardship and mental health conditions.
It also addresses concerns over the use of investigators.
The document will include a new opening statement that outlines core commitments, setting the standard for good corporate culture across the industry.
ICA says it has chosen to introduce guidance and best-practice principles in areas such as family violence, mental health, disclosure and the sale of add-on insurance through motor dealers.
“These best-practice principles, while not mandatory, aim to set higher standards than could be achieved through binding minimum code obligations,” it says.
Action on some areas, such as add-on insurance, has been affected by legislative changes or proposals under way elsewhere.
“These reforms have precluded the industry from making certain changes to the code where there is a risk of code obligations becoming inconsistent with the law.”
ICA will complete the code revisions by November and plans a phased transition, with some obligations requiring more time to take effect than others.