October 25, 2018
Consumers will have access to insurer-specific information relating to the claims and disputes by early 2019, according to APRA, which has released the final version of its reporting standard to the life insurance sector.
The life insurance regulator stated the new standard, which was developed over two rounds of voluntary reporting during 2017 and 2018, would now make it mandatory for life insurers to report data on the types and lengths of claims and disputes.
In a letter sent to all life insurance providers, APRA stated that insurers would be required to report twice a year, covering six-month reporting periods, and any data collected would be shared with ASIC to assist it in its regulatory duties.
Data for the period from 1 July 2017 to 30 June 2018 is due by 28 December 2018 while data for the second half of 2018 will be due by the end of March 2019. In the letter, APRA informed insurers that the first scheduled release of data, on both an industry-level and named individual insurer-level basis, would take place early next year.
Data collection forms released by APRA reveal that insurers will also need to provide details as to whether policies are open or closed to new business, held individually inside or outside of superannuation, or at the group life level, and whether policies have been placed as a result of financial advice.
“…all data collected, as part of the requirements, is non-confidential”
In writing to the insurers, APRA stated its intention was “…that all data collected, as part of the requirements, is non-confidential”, adding the insurance sector was generally supportive of the move “…and pointed to benefits that would flow from more transparency over claims and dispute outcomes”.
“APRA considers that greater transparency is beneficial for consumers and the industry as a whole, and that the benefit to the public from the disclosure would outweigh any potential detriment to the commercial interests that the disclosure might cause,” the regulator stated, adding that data would not identify individual claimants.
APRA Member, Geoff Summerhayes said the publication of granular, at an industry and insurer level, would place APRA and ASIC at the forefront of innovation among global insurance regulators.
“This new standard, based on more than 18 months of engagement with industry and consumer groups, codifies life insurers’ reporting obligations and provides greater clarity around definitions and claims processes,” Summerhayes said.
“The introduction of a legally binding reporting standard will improve the consistency and reliability of the data we receive, and guarantee it continues to be made available to regulators and consumers,” he added.”