Delay in claim handling was the most complained-about issue across every financial product handled by the Australian Financial Complaints Authority (AFCA) in 2025-26. The ombudsman recorded 119,949 complaints, the highest annual volume and the third consecutive year above 100,000. General insurance accounted for 36,022 of them, up 5%.
Those figures capture retail consumer and small business claim disputes and are dominated by comprehensive motor vehicle insurance, which remained the most complained-about product. Over the years, IB has regularly checked in with local brokers like Laura Meyer (pictured), director of MeyerInsure in Ballarat, Victoria, to find out their biggest current pain point with insurers. For Meyer, the main frustration reflects AFCA's findings and is the same as it's always been: turnaround times.
"There are several insurers with claims turnaround times that are just abysmal," Meyer said. The cost of that sits with whoever is chasing the file.
The Insurance Business Australia Brokers on Insurers 2026 report found turnaround times dominated broker priorities, with claims turnaround and new business turnaround moving ahead of overall service level as the top two criteria brokers use when evaluating insurers, the first time that has occurred in the available data. Commission structure ranked last for the third consecutive year.
"So you're spending long wait periods on phones to get things done and really it's caused by resourcing, from what I can tell and the conversations I have with claim handlers that are happy to give me the goss," she said.
That is a pointed observation from a broker who deals with the same insurers repeatedly.
AFCA has also attributed part of the problem to capacity rather than conduct, noting in its general insurance annual review that delays in motor claims are increasingly driven by industry-wide shortages in vehicle parts and skilled labour, including the expanding electric vehicle market.
But while boosting headcount might sometimes be a lever available to a claims manager under pressure, Meyer's position is that pulling it does not necessarily fix the problem.
"Bums on seats is just not enough," she said. "A lot of these insurers are still stuck on legacy systems and everything's just so difficult to do."
Delay is now a regulated conduct question rather than just a service one. Since January 2022, insurers providing claims handling and settling services have been obliged under their Australian financial services licence (AFSL) to provide those services efficiently, honestly and fairly, on top of the existing duty of utmost good faith.
The Australian Securities and Investments Commission (ASIC) commenced Federal Court proceedings against three insurers in the first half of 2025 and insurance claims handling sits among the enforcement priorities it announced for 2026.
In one of those cases, ASIC alleged Hollard Insurance breached its duty of utmost good faith over a home building and contents claim lodged on October 31 2021, two days after a storm damaged the roof of a regional Victorian couple's home. The regulator said the insurer initially accepted the claim, then repeatedly delayed decisions about repairs, took more than nine months to arrange a structural engineer's inspection and delayed providing temporary accommodation, before rejecting the claim 18 months later. The matter is before the court and the allegations are untested.
Meyer's experience is on the commercial side and no comparable public dataset tracks broker-lodged claims by turnaround time. What the two have in common is direction. AFCA has said the persistently high volume of insurance complaints shows industry needs to do more to prevent matters reaching the ombudsman, particularly where the issue is a claim delay.
Meyer said she was unsure whether a technology solution existed that could help some companies. Complaint volumes suggest the sector has not found one either.
