This report outlines the Australian Securities and Investments Commissions work to better understand the consumer experience in home insurance claims since 1 January 2022, when claims handling and settling became a regulated financial service. It summarises ASIC’s key observations on how insurers are meeting their obligations and highlights areas for improvement.

For consumers in the unfortunate situation of needing to claim on their insurance policy, timely and fair claims handling is crucial. This report shows that claims handling generally is under strain— while there are some aspects outside insurers’ direct control, there are many aspects where insurers can and should improve their claims handling practices. Since 1 January 2022, insurers who provide claims handling and settling services have been obligated under their Australian financial services (AFS) licence to provide those services efficiently, honestly and fairly. Insurers handling claims were already obliged to act consistently with the duty of utmost good faith. Recent law reform was intended to lift claims handling standards and enhance ASIC’s ability to act where obligations are breached.

This review observes that all participating insurers can improve. Primary areas for improvement include:

• better communications to consumers about decisions, delays and complications
• better project management and oversight of third parties › better handling of complaints and expressions of dissatisfaction
• better identification and treatment of vulnerable consumers, and
• better resourcing of claims handling and dispute resolution functions.