Australia: New General Insurance Code of Practice
The Insurance Council of Australia’s (ICA) revised General Insurance Code of Practice (the Code) came into effect on 1 July 2014. ICA members and other Code participants have 12 months to transition to the revised Code, with all signatories to be compliant by 1 July 2015.
The first General Insurance Code of Practice was introduced in 1994 and was one of the first of its kind. It has been reviewed four times – in 1998, 2006, 2009 and 2012. Lloyd’s was already a signatory of the previous Code and has now signed the Deed of Adoption subscribing to the new Code. As per the previous Code it applies to all direct insurance policies issued under a binding authority by an Australian coverholder and claims managed by the Australian coverholder or Australian domiciled claims administrator.
The development and launch of the 2014 Code followed a thorough 12 month independent review and extensive consultation with a range of consumer groups, government bodies, regulators and industry leaders.
The Code sets the benchmark for industry self-regulation in Australia. It commits insurers to standards of service that are above and beyond their statutory obligations under the Insurance Contracts Act 1984 and enhances the rights of consumers.
Key features of the 2014 Code include:
- Stronger and more detailed obligations on Code signatories to provide assistance to consumers in financial difficulty
- Clear guidance and timeframes on insurance claims and complaints processes for consumers
- Written in plain, easy-to-read English
The 2014 Code also introduces a new governance framework, the Code Governance Committee (replacing the Code Compliance Committee). The Committee's brief is to ensure Code compliance is effectively monitored and enforced. It is a separate and independent entity from the ICA and Code signatories.
Lloyd’s Australia has been providing updates to Australian coverholders and claims administrators and will continue to do so throughout the transition period.