AFCA has received more than 100,000 complaints for the second year in a row, with life insurance complaints making up just over 1,500 of these in 2024-25.
The authority says it preliminary data snapshot as at June 30 showed:
- Life insurance – 1,518 complaints (up 5%)*
- Banking and finance – 54,581 complaints (down 9%)
- General insurance – 34,231 complaints (up 17%)
- Superannuation – 6,164 complaints (down 16%)
- Investments and advice – 4,193 complaints (up 18%)
While there was a 4% decline in complaints overall, Chief Ombudsman and CEO David Locke says AFCA was still receiving far too many.
“The movement is in the right direction, but receiving 100,000 complaints in a year is still unacceptably high,” Locke said of the 100,745 complaints in 2024-25. The slight decline was from a record 104,861 complaints the previous year.
He says AFCA has now had three years of high complaints. “Firms have more work to do to ensure fair responses to complaints are delivered earlier, without people having to take the extra step of coming to us.”
AFCA says higher complaints in investments and advice and in general insurance outweighed falls elsewhere.
…The top three issues were misleading product or service information, delay in insurance claim handling, and service quality…
It notes the three most complained about financial products overall in 2024-25 were personal transaction accounts, motor vehicle insurance and credit cards. The top three issues were misleading product or service information, delay in insurance claim handling, and service quality.
Investment and advice complaints rose 18% “…amid a string of failures, including United Global Capital, Shield Master Fund, First Guardian Master Fund, and Brite Advisors PL.”
The authority says there was an allied 95% rise in complaints involving self-managed super funds to 1,323 complaints, accounting for a third of complaints in investments and advice. Complaints alleging failure to act in the client’s best interest rose 124% to 1,266.
This only highlights the need for the Compensation Scheme of Last Resort for victims of unlawful advice…
Locke says what the authority is seeing in complaints “…is a clear pattern of conflicted advice models and the inappropriate use of self-managed super funds that ultimately isn’t in the customer’s best interest. This only highlights the need for the Compensation Scheme of Last Resort for victims of unlawful advice.”
While general insurance complaints rose 17% to 34,231, Locke noted that a surge of complaints about add-on insurance was the main cause of the increase. Apart from that the industry had overall made progress on reducing high complaint numbers. However comprehensive vehicle insurance was again the most complained about insurance product.
He also welcomed an improvement in claim handling by superannuation funds, with complaints about delays in claim handling falling 39% in 2024-25.
AFCA says it’s full data will be available in the Annual Review later this year, noting that this data is preliminary and some numbers may change after further analysis and classification. Complaints can involve more than one product and issue.
*In the 2023-24 year, AFCA’s full data report revealed the authority received a total of 1,449 life insurance complaints – down 24% from the previous year. IP policies were the most complained about product followed by term life and TPD (see: Life Insurance Minute Percentage of AFCA Complaints).
