Insurer responds to ASIC concerns

Insurer responds to ASIC concerns | Insurance Business

Insurer responds to ASIC concerns
QBE is to change its outsourcing of escalated complaints following concerns from ASIC.

The regulator was concerned that some QBE customers were receiving written communication on the letterhead of an outside law-firm rather than QBE branded material which could be inconsistent with QBE’s AFS licence obligations in relation to dispute resolution.

ASIC believed this correspondence could “create a potential barrier” for customers looking to resolve disputes as they may “feel intimidated and possibly dissuaded from pursuing their complaint and feel the need to seek unnecessary and costly legal representation,” the regulator said in a statement.

A QBE Australia spokesperson said of the concerns: “We have identified fewer than 10 customers during 2013-2014 who raised their concern about receiving correspondence from an external legal firm, in which time we managed more than 530,000 general insurance claims.

“As ASIC has said, we have not breached any law or guidelines with our practices however we have engaged with ASIC for more than a year to ensure any perceived issues are addressed and to allay its concerns.

“There is nothing to support any suggestion that our customers have felt the need to seek legal representation. However, we recognise the potential and are willingly implementing changes to reduce the possibility of this occurring.”

ASIC Deputy Chairman Peter Kell acknowledged that the insurer co-operated fully with the regulator in resolving the issue and noted the importance of a clear dispute resolution strategy.

“A consumer's ability to access free dispute resolution is an important part of the financial services system,” Kell said.

“While licensees can outsource their dispute resolution functions, it must be done in a way that is consistent with their licence requirements, ensures accessibility to customers and maintains a customer-focussed approach.”