Insurers front up on complaints
Insurers hope providing more data about the complaints they receive will challenge a perception that they are ‘‘always looking for the fine print’’.
The Insurance Council has released its first annual report under the Fair Insurance Code. It has revealed the number of claims received by insurers, the number of complaints made to internal and external dispute resolution schemes, and the number of significant breaches recorded over 2016.
Over the year, there were 1.12 million claims made, 3858 complaints to insurers’ internal processes and 204 complaints to external resolution services. Of those, 14 were upheld and no significant breaches were found.
Chief executive Tim Grafton said: ‘‘Fourteen upheld complaints out of over 1.12 million claims certainly puts in perspective that insurers are meeting high standards of service and resolving almost all claims.
‘‘By reporting the facts, we can hopefully change misconceptions in the community so people can have confidence that insurance is there for you when you need it.’’
He said 95 per cent of all claims were paid but insurers had to battle a perception that they were always trying to look for a way out.
‘‘What we want to do is be as transparent as possible [and show] the volume that insurers deal with and what is the very, very, very small proportion that give rise to someone wanting to complain. And the vast majority of those complaints are dealt with internally by the insurer.’’
Insurance and Financial Services Ombudsman Karen Stevens said her office was most concerned with whether insurers and consumers were able to come to an agreement on a complaint, not the numbers that were upheld.
She said a high proportion of complaints to her scheme were not upheld, sometimes because people did not understand their policy wordings, thought they had more cover or had not disclosed information adequately to their insurer.
New Zealanders were often stoic in the face of disaster and expected to be treated well.
‘‘In a lot of cases, they are. Some people are more likely to complain than others. Sometimes the ones that ought to are too patient or too stoic.’’
She said the Insurance Council statistics showed that insurers were paying a lot of claims and when they were not, their internal complaints systems were dealing with consumers well.
The Fair Insurance Code, which came into effect on January 1 last year, requires insurers to meet minimum timeframes when responding to claims and to keep customers informed. They must act reasonably when faced with non-disclosure and to prioritise vulnerable customers.
Consumer NZ research writer Luke Harrison said more data was needed.
‘‘Rather than publishing high-level statistics which don’t mention individual insurers, we think dispute resolution services should be required to publish specific data on which insurers are subject to the most complaints and which complaints are upheld.’’