Introduction

In its sixth round of hearings, the Commission examined the insurance industry. It did so by reference to case studies involving all stages of the insurance process:

  • the design of insurance products was considered in the CommInsure and IAG case studies;
  • the sale of life insurance products was considered in the ClearView and Freedom case studies;
  • the sale of general insurance products was considered in the Allianz, IAG and AAI (AAMI’s Complete Replacement Cover policy) case studies;
  • the handling of life insurance claims was considered in the CommInsure and TAL case studies; and
  • the handling of general insurance claims made by policyholders affected by natural disasters was considered in the Youi case study, and in both AAI case studies.

Issues connected with group life insurance policies taken out through superannuation were also considered through two case studies. Product design, particularly key definitions and exclusions, and claims handling issues were considered in the REST case study. The AMP case study considered the appropriateness of default settings, the availability of insurance in MySuper products, premium deduction practices and supervisory issues arising from vertical integration.

The case studies also raised broader questions about a number of themes, including the appropriateness of the current regulatory regime and the adequacy of insurers’ compliance frameworks.