Consumers & Small Business
The General Insurance Code of Practice sets out standards that insurers must meet when dealing with consumers, including small business consumers. Insurers who subscribe have committed to being open, fair and honest at all times. The Code also gives you specific rights in a range of situations, such as when you are buying insurance or making a claim.
An independent Code Governance Committee monitors insurers to ensure that they are following the Code. If you believe that an insurer has breached the Code, you can report it to us. If we find that an insurer has breached the Code, we make sure that it addresses the cause of the problem so that other consumers aren’t affected in the future.
The 2014 General Insurance Code of Practice (2014 Code) applies to all Code subscribers until 30 June 2021.
Part 9 (Supporting customers experiencing vulnerability) and Part 10 (Financial Hardship) of the 2020 General Insurance Code of Practice (2020 Code) came into effect on 1 January 2021. Part 10 of the 2020 Code replaced Section 8 of the 2014 Code, while Part 9 introduced new standards to the Code.
The remainder of the 2020 Code applies to all Code subscribers from 1 July 2021.
Your rights under the Code
The Code gives you rights in many areas of your relationship with an insurer, from buying insurance to making a claim or complaint. Insurers, their Distributors and their Service Suppliers must be honest, efficient, fair, transparent and timely in their dealings with you. (Paragraph 21, 2020 Code)
Some of the most important rights include:
- When your insurer offers to renew a home building, home contents, home building and contents or motor vehicle policy bought directly from the insurer, the renewal notice must give you a comparison between this year and last year’s premium and explain how it is calculated. (Paragraph 50, 2020 Code)
- Your policy may give you the right to cancel and receive a refund. If you are entitled to a refund, you should receive it within 15 days. (Paragraph 55, 2020 Code)
- If your insurer offers a cash settlement under your home building policy, it must provide you with information to help you understand how they work and how decisions are made on cash settlements. (Paragraph 79, 2020 Code)
- If your insurer has accepted your claim for a total loss under your home building and contents policy and you are unable to provide proof of ownership for property because it was lost or damaged in the insured event (and your ownership is clear) the insurer will not require you to provide proof of ownership or a list of insured property that was lost or damaged. (Paragraph 80, 2020 Code)
- Insurers must tell you about the progress of your claim at least every 20 business days. (Paragraph 70, 2020 Code)
- When an insurer denies your claim or does not pay your claim in full, it must explain why in writing, offer you copies of the information it used to make the decision, and tell you how you can make a complaint. (Paragraph 81, 2020 Code)
- If an insurer appoints an Investigator or Employee to investigate your claim, it must tell you within five business days that it has appointed them and what their role is. The investigation process must comply with the Claims Investigation Standards in Part 15 of the 2020 Code. (Paragraph 73, 2020 Code)
- If you make a property claim that is finalised quickly after a catastrophe (within a month), you may realise later that your losses were higher than originally assessed. If this happens, you have an extended time – up to a year – to ask your insurer to review the claim, even if you have already signed a release. (Paragraph 90, 2020 Code)
- If you tell an insurer or the insurer identifies that due to a vulnerability, you need additional support or assistance, it will work with you to find a suitable, sensitive and compassionate way to proceed with your matter. (Paragraph 97, 2020 Code)
- Insurers must treat people with any past or current mental health condition fairly. (Paragraph 104, 2020 Code)
- An insurer must have a publicly available policy about how it will support you if you are affected by family violence published on its website. (Paragraph 95, 2020 Code)
- If you tell an insurer, or the insurer identifies, that you are experiencing financial hardship, it must provide you with details about how to apply for support and details for the National Debt Helpline. (Paragraph 111, 2020 Code)
- When you apply for financial hardship support, the insurer must provide its decision to you in writing within 21 days, unless it has asked you to provide more information. (Paragraph 121, 2020 Code)
- If an insurer decides you are entitled to financial hardship support, it must work with you to implement an arrangement, such as delaying the date on which payment must be made, paying in instalments, or paying a reduced lump sum amount. (Paragraph 123, 2020 Code)
- If an insurer decides you are not entitled to financial hardship support, it must tell you the reasons for its decision and about its Complaints process. (Paragraph 129, 2020 Code)
- You may complain to your insurer about any aspect of your relationship with them. (Paragraph 139, 2020 Code)
- Insurers must respond to complaints in writing, explaining the reasons for their decision, and informing you of your right to take your complaint to the Australian Financial Complaints Authority (AFCA) if you are not satisfied with the decision. (Paragraphs 148 and 149, 2020 Code)
- An insurer must give you a final response to your complaint within 45 days. If it cannot make its decision within this timeframe, then before this deadline passes the insurer must tell you, in writing, the reasons for the delay. (Paragraph 147, 2020 Code)
If an insurer breaches the Code
If you think an insurer has not lived up to the standards in the Code, you can report your concern to the Committee. If we find that an insurer has breached the Code, we will work with it to find and address the cause of the breach.
We investigate potential Code breaches to improve insurers’ practices for the future – not to get a specific outcome in your individual case. If you want your individual problem to be addressed – for example, if you want compensation, an apology, or for the problem to be fixed – you should instead contact your insurer to make a complaint.
If you’re not happy with your insurer’s response to your complaint, you can take the complaint to the Australian Financial Complaints Authority (AFCA). AFCA is a free, fair, independent service that helps resolve disputes between consumers and insurers.
If you would like to help the Committee drive higher standards in the insurance industry, you can report your concern that an insurer has or may have breached the Code to the Committee.
Once you report your concern to the Committee, you will receive an email confirming we have received your message. We will:
- Assess the issue — We will check whether your issue is something we have the power to investigate.
- Consider the evidence — If we decide to investigate, we will ask the insurer for its response and consider the evidence.
- Make a decision — We will make a decision about whether the insurer has breached the Code. You and the insurer will be informed about the outcome.
- Make improvements — If a breach has occurred, we will work with the insurer to agree to changes they will make to prevent the same issue occurring again in future.
Other help for consumers
A range of other organisations provide free information and services to help consumers with insurance issues.
- Australian Financial Complaints Authority (AFCA) — If you have a complaint that you haven’t been able to resolve with your insurer directly, AFCA may be able to assist. AFCA provides free, accessible and independent help to resolve disputes between consumers and financial firms.
- Insurance Law Service — The Financial Rights Legal Centre Insurance Law Service provides free advice and advocacy for consumers in financial stress. Call its Insurance Hotline on 1300 663 464.
- National Debt Helpline — Call the National Debt Helpline for over-the-phone financial counselling – free help to manage your debts and get your finances back under control. Freecall 1800 007 007 from 9:30 am to 4.00 pm, Monday to Friday.
- Financial Counselling Australia — For free, face-to-face financial counselling, use FCA’s service locator to find a service close to you.
- MoneySmart — The MoneySmart website has free, independent information and tools to help you make decisions about insurance.
- Understand Insurance — The Insurance Council of Australia’s Understand Insurance website has straightforward explanations of insurance matters plus a range of apps, calculators and checklists.