ASIC has written a letter to general insurers on expectations from them while they respond to consumers in financial hardship
The Australian Securities and Investments Commission (ASIC), Senior Executive Leader—Insurers Financial Services and Wealth Group, Emma Curtis, has written a letter to directors of general insurers on expectations of them in responding to the COVID-19 pandemic—namely, that insurers consider their conduct in light of the current circumstances and act in a fair and professional manner in line with their duty of utmost good faith.
The letter sets out the improvements ASIC expects all Australian general insurers to make on hardship and travel insurance.
Curtis said, “We consider there is real value in continuing to improve industry standards for better and more consistent outcomes for consumers.”
“We expect that all Australian general insurers and, where relevant, third-party distributors (including of ‘white-labelled’ products), will apply them to their ongoing business operations to ensure a more complete and robust hardship framework for the future.”
“We encourage you, as directors, to continue to consider what options and actions may be suitable in these challenging times—in line with the obligation for an AFS licensee to do all things necessary to provide financial services efficiently, honestly and fairly,” she added.
Since June 2020, ASIC has been reviewing and monitoring how general insurers have responded to consumers experiencing financial hardship during the COVID-19 pandemic. In particular, the regulator has focused on home insurance and car insurance, and on travel insurance.
The letter states that ASIC will continue to monitor how general insurers are responding to consumers experiencing financial hardship or vulnerability.
Curtis said, “We thank the general insurers and the Insurance Council of Australia (ICA) for their continued and positive engagement on this work. We look forward to ongoing engagement with industry on these key issues.”
You can read the entire letter here.