Many Australian insurers already offer online access to insurance policies and policy disclosure statements but these tend to be for car, home and travel insurance, and often the question is asked surrounding these ‘have you read and understood the policy?’.
Given the complexities within a commercial or business policy would placing these documents online threaten or enhance the role a broker plays in providing advice and assisting clients in selecting the right insurance product.
This debate is currently taking place in parts of the USA where Rutgers University insurance law professor Jay Feinman says insurers should be pushing more policy details online.
Feinman says insurance in the USA is such that many people don’t know what they are buying until they have bought it, despite choosing their level of cover, excess and premiums up front. He says people taking insurance are not able to read the fine print until after they have become a customer.
However he points to a scheme in Nevada where the state regulator publishes the standard policy forms from the states’ 10 largest home and car insurers allowing people seeking insurance to shop around to compare policies.
Feinman admits this step alone will not tackle the problem of insurance education with many people choosing not to read but consumer groups could take on the task of creating guides that compare and rate the benefits of one policy against another.
While it appears that the Australian market is ahead of the USA in placing information online the issues around insurance education and understanding seem to be similar.
Would publishing the details of common policies boost the work of brokers and cause more people to seek professional advice?
With many insurance policy details already available would there be a benefit for the insurance broking industry to have a regulator publish standard forms?
Given the recent natural disasters across Australia would this type of online listing of policy remove some of the complaints surrounding claims?