A Rotorua woman’s struggle to obtain her own life insurance policy documents before brain surgery has exposed accountability gaps in bancassurance distribution – at a time when New Zealand’s conduct regulator is escalating enforcement against insurers and the industry’s dispute resolution scheme is recording complaint volumes at their highest level on record.
Kat Fleming, a 43-year-old volunteer firefighter and adventure tourism worker, was diagnosed with a brain tumour and scheduled for surgery on July 23. Seeking to put her affairs in order, she visited her local ASB Bank branch in Rotorua to request a copy of her life insurance policy – a $375,000 Lifestyle Security Plan she had taken out in 2013 and continued paying at $25 a fortnight. AIA New Zealand is New Zealand’s largest life insurer by market share according to the Financial Services Council (FSC), and ASB is its distribution partner for the policy. Despite confirming the policy's existence through AIA’s mobile app at the branch, Fleming was told the relevant team had a 28-minute wait time and that callbacks were not available. Her options were to wait on hold or email a request and wait five to 10 working days. “AIA said those were my two options, email or 28 minute wait on the phone,” Fleming told Stuff. She left without the documents.
A branch complaint was lodged on her behalf. After 48 hours and no documents, she contacted Stuff. Within an hour of the publication contacting both institutions on July 15, the documents were sent – not to Fleming, but to her husband, who turned out to be the named policy owner. AIA’s head of customer operations, Andrew Anisi, then contacted Fleming directly to explain that her husband was the only person authorised to receive the documents under AIA’s privacy and ownership protocols. Fleming said neither institution had communicated that distinction at any point during her requests. “One of my questions was, when you log in on the AIA app, why does it not say under the ‘policy owner title’ – ‘only policy owners may request documents or make changes’? That would be what you’d call effective communication and is black and white,” she said.
ASB’s insurance page directs life and health customers to view, claim, and update their policy via the MyAIA portal. AIA confirmed to Stuff, however, that full policy documents are not currently available through MyAIA and must be requested separately – a limitation not disclosed within the portal at the point of login. The FMA’s 2025/26 monitoring found that some insurers treat the absence of complaints or negative indicators as confirmation that consumers are being treated fairly – an approach the FMA said does not meet its expectations. Fleming did not lodge a formal complaint with the Insurance & Financial Services Ombudsman Scheme (IFSO). Her case was resolved through a media inquiry. Under the FMA’s current supervisory framework, that outcome – resolution without internal escalation or formal dispute – would not generate the complaints data the regulator expects firms to be analysing. The FMA’s Financial Conduct Report states that insurers have an existing obligation to communicate with consumers in a timely, clear, concise, and effective manner across all parts of the insurance life cycle, including when a complaint is lodged.
The case directly engages obligations under the Conduct of Financial Institutions (CoFI) regime, which came into full force on March 31, 2025. The regime requires registered banks and licensed insurers to comply with a fair conduct principle across all consumer dealings and to establish effective fair conduct programmes. When CoFI launched, FMA director of deposit taking, insurance and advice Michael Hewes said the regime was “fundamentally about treating customers and potential customers fairly” and that the FMA expected financial institutions to be “communicating effectively with consumers and acting quickly if something is not working as it should be.”
The accountability question in bancassurance arrangements has a documented history in New Zealand. The FMA and the Reserve Bank of New Zealand’s (RBNZ) 2019 life insurer conduct and culture review found that in situations where sales and advice were provided through an intermediary, there was a lack of oversight and responsibility for customer outcomes, with some insurers not considering themselves responsible for the intermediary’s impact on those outcomes – instead seeing the intermediary as their customer. CoFI was introduced, in part, to close that gap.
The enforcement consequences of system and communication failures in such arrangements are now established. The Auckland High Court ordered IAG New Zealand – which, like AIA, administers policies distributed through bank and broker intermediaries – to pay $19.5 million in October 2025 for fair dealing breaches, with the court noting that as a large and central player in a web of insurance brands, bank partners, and brokers, IAG has a vital role in setting and upholding market standards.
In Fleming’s case, ASB cited privacy obligations as the basis for not acting directly on her requests, while AIA attributed the delay to policy ownership and privacy requirements. Neither institution resolved the matter through its internal processes within the three-day period before media contact prompted resolution. “We recognise that this experience fell short of the level of service we aim to provide our customers,” an AIA New Zealand spokesperson said, as reported by Stuff. ASB said it “worked on the customer’s behalf, and in collaboration with AIA as our insurance partner, to progress the matter as quickly as possible,” and apologised for any additional stress.
In the year to June 30, 2025, the IFSO accepted 600 disputes for investigation – a 25% increase on the prior year and more than double the 2022 total – with life, health, and disability complaints accounting for 29% of all cases investigated. Stevens noted that more disputes are reaching the scheme because consumers are not always satisfied with the outcome of their insurer’s internal review process. From its 2025/26 monitoring, the FMA found that only some insurers have comprehensive complaints policies that are regularly reviewed and updated, and that use of complaints data to drive product improvements remains inconsistent across the sector. Fleming’s case illustrates the gap precisely: an unresolved internal complaint, escalated not to the IFSO but to a media outlet, producing no complaints data for either institution to analyse, and no regulatory visibility of the failure.
For insurance professionals, the case presents three questions directly relevant to bancassurance operations. First, are the respective responsibilities for document access, complaint escalation, and ownership communication clearly delineated between insurer and distributor, and do frontline staff at both understand them? Second, does digital infrastructure – including customer portals – meet reasonable access expectations for policyholders in urgent or vulnerable circumstances? Third, is policy ownership communicated clearly enough at point of sale and through ongoing digital touchpoints, so customers are not left navigating distinctions that were never explained to them?
The FMA has signalled it will focus on conduct impacting consumers in vulnerable circumstances, with life and health insurance products among the named priorities. A policyholder preparing for brain surgery who could not access her own policy documents for three days before a media inquiry intervened represents precisely the category of outcome that conduct framework is designed to prevent. “I don’t think I would’ve had any joy getting a copy if you hadn’t been asking questions for me three days later,” Fleming said.
