NIBA conveys member concerns to AFCA

NIBA has provided a submission on behalf of members to the review of AFCA

Written on 14 April, 2021
Tanaya Das

The National Insurance Brokers Association (NIBA) has provided a submission on behalf of members to the review of the Australian Financial Complaints Authority (AFCA).

In the submission, NIBA reiterated members calls for a more robust complaint triage system. As brokers operate as an intermediary between insurers and clients, brokers are often party to complaints, arising from actions taken by insurers. Despite this, broking firms bear the costs of complaints which are often disproportionate to the amounts in dispute.

The submission states, “Broking firms bear the cost of AFCA’s complaint, even when there is no real basis for the complaint against the broker. If the broking firm needs to take the matter to a decision stage in order to obtain an appropriate decision in their favour, the cost of the process is substantial, and is often disproportionate to amount in dispute.”

NIBA also highlighted that a lack of complaint triage allows disingenuous complainants to “game the system” in order to obtain an outcome in their favour regardless of the validity of their complaint- simply because it is far simpler and cheaper for the broking firm to make a payment and not face the cost of a formal decision.

The submission mentions that it is the Association’s strong view that any further changes to AFCA monetary jurisdiction should only occur in conjunction with the ability of the financial services provider to have the determination reviewed by a competent appellant body.