Insurer Compensates Claimants in Wake of Transition Issues
Insurer Compensates Claimants in Wake of Transition Issues
The Life Code Compliance Committee reported that the insurer failed to meet the necessary timelines for handling claims, resulting in 3580 breaches between November 2022 and August last year. This failure predominantly affected policyholders with income protection and total permanent disability coverage from a superannuation fund.
The issue arose following the insurer and the fund's decision to transfer claims processing responsibilities from a third-party service provider back to the insurer. The transition period saw numerous staffing issues at the third-party organization, which critically hampered its ability to meet the code's stipulated time frames for claims processing, the committee's investigation revealed.
The committee's findings indicated that the insurer violated several provisions of the claims handling process defined in the code. Specifically, the insurer failed to:
- Inform customers about the claims process within 10 business days;
- Provide updates on the progress of claims every 20 working days;
- Notify customers in advance when their income protection claim payments were nearing their end.
"Insurers must ensure their change management plans allocate adequate resources to meet service standards and prescribed time frames," the determination stated. "Utilizing effective risk mitigation strategies is crucial in countering potential issues, thereby protecting against disruptions and safeguarding customer interests during transitions."
Post-transition, the insurer took over claims management on July 1 of the previous year and initiated several steps to bolster compliance with the code. The company formed new teams and conducted training focusing on code requirements and system utilization.
"The insurer has augmented its oversight of claims processing by increasing case conferencing, setting up weekly performance tracking, and holding monthly governance meetings," the determination noted. "These improvements led to noticeable increases in compliance rates regarding time frame obligations, which became more stable starting in December."
These measures indicate significant shifts in how the insurer manages and processes claims, fostering better service standards and accountability.
Published:Wednesday, 4th Sep 2024
Source: Paige Estritori
Share this news item:
| nib Health Insurance Premiums to Rise by 5.79% in 2025 05 Jan 2026: Paige Estritori nib holdings limited has announced an average increase of 5.79% in health insurance premiums, effective from 1 April 2025. This adjustment reflects the insurer's response to escalating healthcare costs and heightened utilisation of medical services. - read more |
| Enhancing Digital Integration: ADHA's Plan for Allied Health Professionals 05 Jan 2026: Paige Estritori The Australian Digital Health Agency (ADHA) has introduced the National Allied Health Digital Uplift Plan, a strategic initiative designed to bolster the digital capabilities of allied health professionals across the nation. This plan aims to facilitate seamless sharing of health information among practitioners, patients, and multidisciplinary care teams, thereby enhancing the quality and efficiency of patient care. - read more |
| Strengthened Legal Safeguards for Whistleblowers in the Health Sector 05 Jan 2026: Paige Estritori Recent amendments to the National Law have introduced robust legal protections for whistleblowers within the health sector, marking a significant advancement in promoting transparency and accountability. These changes criminalise any form of retaliation against individuals who report misconduct, including the use of non-disclosure agreements (NDAs) to suppress such disclosures. - read more |
| AUSactive and Private Healthcare Australia Join Forces to Enhance Preventive Health Coverage 05 Jan 2026: Paige Estritori In a significant move towards integrating fitness services into health insurance coverage, AUSactive has partnered with Private Healthcare Australia (PHA) to drive reforms in the private health insurance sector. This collaboration seeks to expand access to evidence-based preventive health services, including Pilates, Yoga, Tai Chi, and structured exercise programs delivered by accredited professionals. - read more |
| Income Protection for Health Workers: What You Need to Know Income protection insurance is a crucial financial safety net designed to replace a portion of your income if you're unable to work due to illness or injury. For many, it's a vital component of a robust financial plan, offering peace of mind and stability. But why is it particularly important for healthcare professionals in Australia? - read more
|
| Single or Married: How Life Insurance Needs Vary Across Different Life Stages Life insurance is a financial product that provides a lump sum payment to your beneficiaries in the event of your death. It is designed to offer financial security by covering debts, daily living expenses, and future financial obligations. - read more
|
| How Income Protection Insurance Can Safeguard Your Financial Future Income Protection Insurance is a type of insurance policy designed to provide you with a substitute income if you are unable to work due to illness or injury. This form of insurance essentially acts as a financial safety net, ensuring that you can continue to manage your living expenses even when your regular earnings have been disrupted. - read more
|
| Understanding Life Insurance: Coverage Types to Protect Your Loved Ones The importance of life insurance in financial planning: Life insurance isn’t just a policy; it’s a cornerstone of comprehensive financial planning. By protecting your family’s financial future, life insurance offers peace of mind, knowing that your loved ones will be taken care of in the event of your untimely passing. It’s not solely about leaving behind a legacy, but also ensuring that your family can maintain their standard of living, pay off debts, and cover end-of-life expenses without financial burden. - read more
|
An optional provision added to an insurance policy that provides additional benefits or coverage.