Insurance Groups Critique ASIC's Proposed Code of Practice
What happened
The Insurance Council of Australia lodged a redrafted General Insurance Code of Practice with ASIC. The Australian Consumers Insurance Lobby criticized the revised Code, stating it still does not expressly prohibit commercial arrangements that could compromise the independence of expert reports used in claims decisions. The redrafted Code proposes making key insurer obligations contractually enforceable for the first time since 1994.
Why it matters
ASIC must approve the Code for it to be legally enforceable. The critique highlights that neither the revised Code nor the ICA's standard expressly bars financial incentives that reward expert suppliers for reducing or denying claims. This regulatory process affects how insurers handle claims and manage expert independence.
ASIC requires approval for the General Insurance Code of Practice to be legally enforceable.
Who's involved
- ASICThe corporate regulator reviewing the General Insurance Code of Practice.
Who could feel it
Possible knock-on effectsThese are possibilities Brind reasoned out, not predictions, and not advice. Most are not stated in any report.
- Insurance Australia GroupSpeculative
Insurance Australia Group might face changes in contractual obligations and operational costs as it must adopt the new, legally binding Code.
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The entities involved
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ASIC
organization
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