ASIC has published the results of its review of nearly 4800 individual disability income insurance (IDII) claims received between 1 January and 30 June 2021.
ASIC says it has longstanding concerns about the potential consumer harm resulting from over-use of intrusive claims handling practices like non-disclosure investigations and physical surveillances. The Financial Services Royal Commission examined several case studies.
ASIC says its review found that use of surveillance may have been unwarranted in 17.5% of claims where surveillance was used, because the insurer had not shown that other investigative methods had been exhausted.
ASIC concluded that more work is needed by insurers to ensure that consumers are protected from unfair practices in investigations.
As a result of ASIC’s review, ASIC says some life insurers have made improvements to their practices. ASIC’s inquiries are continuing with those life insurers that had a higher proportion of potentially unwarranted investigations identified in the review.
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Author: David Jacobson
Principal, Bright Corporate Law
About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.
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