In April 2016, the Australian Securities and Investments Commission commenced an investigation into the life insurance business of The Colonial Mutual Life Assurance Society Limited, trading as CommInsure.
The investigation relates to a range of concerns regarding CommInsure's life insurance business, including its claims handling practices and procedures. The investigation commenced following concerns raised in the media earlier this year.
ASIC has undertaken an extensive range of enquiries into the concerns raised. Enquiries are ongoing and no comment on potential outcomes will be made at this time. Given the wide ranging and often complex nature of these matters, ASIC's investigation is anticipated to continue for some time. The investigation remains a priority for ASIC and we will provide public updates where appropriate as the matter progresses.
ASIC has worked closely with APRA during the investigation.
As part of the investigation so far, ASIC has:
- obtained approximately 60,000 documents for consideration
- interviewed a range of individuals
- obtained external legal advice
- engaged extensively with CommInsure and CommInsure's independent reviewers, and
- liaised with the Financial Ombudsman Service and the Superannuation Complaints Tribunal in relation to CommInsure matters.
ASIC has also released Report 498, Life insurance claims: An industry review today. It identifies a number of areas as potential opportunities for law reform in relation to life insurance.
Separately to ASIC's investigation, CommInsure has commenced a number of independent reviews, including in relation to declined claims, its life insurance claims handling practices and in relation to ethical concerns raised in the media.
ASIC has been engaging closely with CommInsure concerning the scope and findings of these reviews. ASIC will continue to monitor the scope and conduct of these reviews and will continue to liaise closely with APRA during this process.
In March 2016, CommInsure announced that it would update the definitions of heart attack and severe rheumatoid arthritis in its trauma products, and reassess past claims under those definitions going back to 11 May 2014. CommInsure advises it has paid benefits for 17 claims, totalling approximately $2.5 million.
In the meantime, if consumers have any concerns about a CommInsure life insurance policy or claim, they should contact CommInsure's customer relations team on 1800 106 133 or 13 10 56. Consumers can also take a life insurance claim dispute to the Financial Ombudsman Service or, if the claim is in relation to a life insurance policy held through a superannuation fund, the Superannuation Complaints Tribunal.
Further information about taking a dispute to the Financial Ombudsman Service and the Superannuation Complaints Tribunal can be viewed at www.fos.org.au and www.sct.gov.au.
Background
CommInsure is the business name of The Colonial Mutual Life Assurance Society Limited and Commonwealth Insurance Limited.