June 5, 2018
Life insurers are likely to take over the task of collecting and analysing claims and dispute data from ASIC and APRA, after the two regulators gave their support to a data gathering project presented by the FSC.
Under the project, life insurers would fund an independent data expert to collect and analyse claims and disputes data, and help insurers pass on relevant data to ASIC and APRA when required as part of their joint Claims Handling Data Collection scheme (see:Regulators Begin Collection of Claims Data).
The two regulators announced in-principle support of the industry driven project as part of the recent release of the second round of claims and dispute data, which confirmed advised insurance had higher levels of successful claims (see: Advised Insurance Best for Claims).
“The agencies consider that robust reporting offers the life insurance industry an opportunity to better understand and communicate claims performance to the community,” ASIC and APRA stated.
“The industry has acknowledged this by approaching the agencies via the Financial Services Council with a proposal to engage and fund an independent data expert to collect and analyse claims and disputes data,” the two regulators added.
“…robust reporting offers the life insurance industry an opportunity to better understand and communicate claims performance to the community…”
ASIC and APRA stated the project would lift the data gathering and reporting capabilities of the life insurance sector as well as its ability to communicate its performance around claims and dispute management.
Their joint support was, however, subject to a number of conditions including that the data gathering project is implemented in line with the timetable and objectives developed by ASIC and APRA to have insurer specific data made available to consumers (see: APRA Says Claims Data Will Be Made Public).
ASIC and APRA stated they are currently working with the FSC on its proposal and APRA plans to finalise a proposed Reporting Standard, and collect data under it, later this year and to publish insurer specific data in early 2019.
The FSC welcomed the in-principle support of the two regulators stating the Council and its life insurance members “…wish to build on APRA and ASIC’s existing Claims Handling Data Collection project to collect more granular information from the industry in a range of areas including better information on the types of impairments claims are paid for”.
According to the FSC, the project would include a blue print for its life insurance members to collect better consumer data in an industry-standardised format and help consumers understand the benefits of life insurance while applying further transparency and accountability to the claims handling process.