Insurance broker conduct is feeding directly into Australian Securities and Investment Commission (ASIC) surveillance cases, with the regulator confirming that alleged premium diversion and licensing failures featured among matters escalated for investigation in the first half of 2026 – arriving at a point when ASIC has recorded its most active enforcement year on record. The ASIC published its misconduct data for January 1 to June 30, 2026, on September 3, recording 9,807 public reports. The volume is context. The substance, for brokers, is what the regulator confirmed it acted on.
ASIC confirmed that insurance complaints and claims handling is among its enforcement priorities for 2026. That priority has a live expression in the current data. One of three illustrative cases cited by ASIC involved an industry association and a finance industry professional separately reporting that an insurance broker may have collected client premiums without remitting them to the insurer – potentially leaving clients uninsured without their knowledge. ASIC confirmed the matter was referred for assessment and possible investigation.
Under Chapter 7 of the Corporations Act 2001 (Cth), holders of an Australian financial services licence (AFSL) must do all things necessary to ensure the financial services covered by their licence are provided efficiently, honestly, and fairly. Failure to remit client premiums, if substantiated, constitutes a breach of those statutory obligations – and exposes clients to uninsured losses they may not discover until a claim is made.
ASIC’s enforcement figures for 2025-26 recorded a record $830 million in civil penalty orders and $644 million returned to Australians through remediation and related payments. That compares with $104.1 million in civil penalties in 2024-25, meaning the 2025-26 figure was approximately eight times higher. Separately, ASIC delivered 150 administrative enforcement outcomes in 2025-26, removing or restricting 87 individuals and businesses from providing financial services, removing or restricting 27 from credit services, and disqualifying 36 individuals from managing corporations – with financial services removals reaching their highest level in the past five years. Of those outcomes, 61% of financial services results ended in permanent banning orders or licence cancellations.
Within the misconduct data, ASIC announced in November 2025 that insurance complaints and claims handling would be among its new enforcement priorities for 2026, alongside private credit practices, financial reporting misconduct, and misleading pricing, having doubled the number of new investigations and nearly doubled new court proceedings in the preceding 12 months. Of the 9,807 reports in the current period, 1,681 – or 17% – were prioritised for further assessment based on ASIC’s Corporate Plan priorities, a 3% increase on the prior period. A further 170 reports directly assisted existing surveillance or investigation cases. ASIC chair Sarah Court said: “The data ASIC receives provides critical insights into the trending issues facing consumers and businesses, helping to inform our enforcement priorities. We continue to welcome tip-offs from the public.”
Beyond premium handling, ASIC confirmed escalation of two further broker-relevant matters: unlicensed provision of financial services and failure to hold Australian Financial Complaints Authority (AFCA) membership. AFCA membership is a condition of holding an AFSL. Brokers who have allowed that membership to lapse are operating outside their licence conditions and are directly exposed to regulatory action. AFCA received 34,231 general insurance complaints in 2024-25, a 17% increase from 2023-24. General insurance broker complaints to AFCA rose to 788 in 2024-25, up from 447 the prior year, representing approximately 0.8% of total complaints – a share that has nearly doubled year-on-year.
The broker sector’s self-regulatory record adds weight to the regulatory signal. The Insurance Brokers Code Compliance Committee’s (IBCCC) 2025 Annual Data Report, released June 16, 2026, documented 5,417 breaches of the Insurance Brokers Code of Practice, affecting 14,842 clients, with complaints rising to 3,133. The IBCCC also identified a detection gap: of the six brokers that reported zero breaches in 2024, five subsequently reported breaches in their 2025 Annual Compliance Statement, indicating issues were present but had not previously been identified or reported. A targeted strata review found none of the seven brokers examined was consistently implementing the code’s safeguards, with nine breach determinations issued and two brokers referred to ASIC.
The Australian Consumers Insurance Lobby (ACIL), the Owners Corporation Network (OCN), and the Unit Owners Association of Queensland (UOAQ) announced on July 16, 2026, that they would withdraw from the National Insurance Brokers Association of Australia's (NIBA) code consultation process and instead engage directly with ASIC and the federal government. NIBA has pointed to client satisfaction research and the sector’s relatively low share of AFCA complaints in support of the profession’s self-regulatory framework. In response to the IBCCC’s 2024 Annual Data Report, published in 2025, NIBA said the increase in reported breaches “reflects the strong compliance frameworks and oversight mechanisms in place within broking firms.”
The broker code’s voluntary, non-enforceable status means the statutory framework – not the code – is the operative protection for clients where breaches occur. Court underlined how the regulator uses public intelligence to enforce that framework: “Reports from the public remain a vital source of intelligence for ASIC, that help us identify consumer harm and to target resources where they will have the greatest deterrence and consumer benefit.”
ASIC confirmed that reports not acted on immediately remain on its database and can inform future investigations. The data points to three compliance areas carrying the clearest current risk for brokers: premium handling controls ensuring client funds reach insurers before a claim arises; active AFCA membership and functioning internal dispute resolution procedures; and licensing supervision of authorised representatives. The IBCCC’s detection gap finding suggests that zero-breach self-assessments are now drawing active scrutiny rather than signalling clean compliance.
