1% of Complaints to AFCA About Life Insurance

AFCA has sharpened its focus on insurance claims handling as complaints about delayed settlements climb.

Speaking at a half-yearly member forum, the organisation’s Chief Ombudsman David Locke said complaints exceeded 111,000 in 2025 (up 14% on 2024) with no sign of change so far this year.

However, an AFCA spokesperson later confirmed that just 1,472 (1.3%) of all complaints related to life insurance for the 12 months to 31 December 2025.

While increases are broad-based, Locke singled out insurance, including life insurance, as a key friction point.

…claims handling is often central to escalation…

“In insurance, claims handling is often central to escalation,” he said, pointing to delays, poor communication and unclear processes as common triggers.

Locke stressed that many complaints are not inherently complex and could be resolved earlier through stronger internal dispute resolution (IDR), reducing cost and reputational exposure for firms.

“Investing in better IDR and working with external dispute resolution is not just good customer practice, it is one of the most effective ways members have to control cost, manage risk, and reduce exposure to later-stage escalation,” he said.

He also noted that rising complaint volumes reflect external pressures faced by clients, such as cost-of-living strain – rather than company conduct alone – and warned this environment increases sensitivity to delays and perceived unfairness.

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