ASIC sets expectations of life and general insurers following a review of insurers’ responses to consumers experiencing financial hardship during the COVID-19 pandemic
ASIC reviewed the responses of major life and general insurers to consumers experiencing financial hardship during the COVID-19 pandemic. ASIC focused on ensuring that insurers were doing everything possible to support consumers in times of need.
ASIC was pleased with insurers’ responsiveness to consumer needs during the pandemic, and to ASIC’s work in this area.
We were also pleased that all travel insurance providers we engaged with offered a refund of premiums paid by consumers for travel insurance policies affected by travel restrictions during the COVID-19 pandemic.
Our review identified better practices and a number of areas where insurers could make improvements to support consumers experiencing hardship. ASIC has written to Australian life and general insurers about the improvements we expect them to make so that there are enduring supports in place to help consumers experiencing hardship.
Insurers provided a broad range of support options to consumers negatively affected by the pandemic so they could maintain insurance cover and lodge claims if they needed to. Many insurers offered a wide range of options to consumers who had difficulty paying premiums or excesses.
ASIC expects insurers to review our letter and to integrate these hardship arrangements into their ongoing operations for a more complete and robust hardship framework. This will enable insurers to respond effectively to consumers who experience heightened financial vulnerability from other events including natural disasters such as floods and bushfires.