When you disagree with an insurer

Three stages, in order

1. Stage 1

   Raise it with the insurer

   Moneysmart’s first step for any financial product is to contact the business, explain the problem and say how you’d like it fixed. Often a call, email or online chat is enough.

2. Stage 2

   Make a formal complaint

   Moneysmart’s next step, if that doesn’t fix it, is a formal complaint in writing. This is internal dispute resolution, often shortened to IDR. For insurers that have adopted the Code, the timeframes below apply. The section on the General Insurance Code of Practice explains what adopting it means for an insurer.

3. Stage 3

   Take it to AFCA

   Moneysmart says an external scheme can help if the business didn’t respond within a reasonable time, if you’re unhappy with how it dealt with your complaint, or if you’re unhappy with its offer. For general insurance that scheme is AFCA, and the Code says you can take your complaint there at any time, and if the insurer hasn’t resolved it within 30 calendar days.

Put it in writing, and call it a complaint

Moneysmart’s first item for a written complaint is the word itself, in the heading or subject line. For context, in a review published in 2024, ASIC looked at how 11 general insurers handle complaints, and found this:

Moneysmart’s full list of what to include:

• “complaint” as a word in the subject line or heading
• the date, with your name and how to contact you
• what went wrong, set out clearly, and what you want done about it
• copies of any documents that relate to it, for example receipts, invoices and statements

Keep the originals of anything you send, and a copy of the complaint itself.

What the Code says happens next

Part 11 of the General Insurance Code of Practice covers complaints about retail insurance. Under it, the insurer will:

• acknowledge your complaint, and give you the name and contact details of the person liaising with you
• have it handled by someone with appropriate authority, knowledge or experience, who is not the person whose decision or conduct it is about
• keep you informed at least every 10 business days, unless it is resolved sooner or you agree otherwise
• decide within 30 calendar days, or tell you in writing before then why it’s delayed, and about your right to go to AFCA and its contact details

The final answer comes in writing with the reasons, your right to take the complaint to AFCA, AFCA’s contact details, and the timeframe for doing so. The Code allows a complaint resolved to your satisfaction, or answered with an explanation or apology, within 5 business days to go without a written response, but not one about financial hardship, a declined claim or the value of a claim, or one where you asked for a written response.

You can also ask for the information the insurer relied on in deciding your complaint. It must give it to you within 10 business days of your asking. The Code lets the insurer refuse access in some circumstances, such as where a law says it does not have to; if it refuses, it tells you why and about its complaints process. Where it refuses because access may prejudice it in a complaint or dispute, it must still give you any external experts’ reports it relied on.

The external scheme

Moneysmart lists AFCA as the external dispute resolution scheme for complaints about credit, banking, investments, superannuation and insurance, among others. The Code adds three points:

• Under AFCA’s Rules, a complaint that hasn’t been through the insurer’s complaints process may be referred back to the insurer.
• AFCA’s decisions are binding on the insurer in the way its Rules set out.
• If AFCA says it can’t assist, you can seek independent legal advice, or use any other dispute resolution option open to you.

AFCA’s own Rules decide which complaints it can take, and the insurer’s final answer gives the timeframe for going to it. Read them on AFCA’s website rather than relying on a summary here.

Help along the way

Moneysmart points out that a community legal centre may be able to give you legal advice for free. For car insurance after an accident, it points to the Financial Rights Legal Centre’s motor vehicle accident problem solver. And if the dispute is about a cash settlement, Moneysmart suggests first asking the insurer to explain its calculation, or offering quotes of your own.