Consumer Protection and Life Insurance Claims

This article examines life insurance claims handling in Australia in light of ASIC's Report No 498 (Life Insurance Claims Report), a report produced in the wake of media coverage relating to the claims handling conduct of CommInsure. This article analyses the current regulation of life insurance claims, and considers recent developments which are designed to improve the level of consumer protection. It analyses the Corporations Act licensing and product disclosure regimes. It then outlines the duty of utmost good faith, concluding that although the duty applies to claims handling, the regime for enforcing compliance with the duty is inadequate. Finally, it considers the provisions of the Life Insurance Code of Practice (Life Code) relevant to life insurance claims handling.