Maurice Blackburn: “We also have concerns about how comprehensive this review has been….”
- Both regulators – ASIC and APRA – have been provided with all reports and reviews (Deloitte, DLA Piper and Ernst & Young).
- At the Parliamentary Joint Committee on Corporations and Financial Services Inquiry into the life insurance industry on 24 February 2017, APRA stated that it “satisfied that the reviews are robust, complete and independent.” (from APRA’s opening statement to the PJC).
- We believe this work is the largest independent review of insurance claims ever conducted in Australian history.
Maurice Blackburn: “Claims samples that have been referenced in the report are also questionable”
- Deloitte state: “Given the level of coverage obtained by our sample we believe that the work performed is sufficient to have reasonably identified any matters that may systemically affect the declined claims populations”.
- A large cohort of TPD claims were reviewed – the largest cohort of claims by far – a total of over 200.
- Deloitte examined 21% of declined claims in the last 5 years
- 100% of terminal illness claims over the past 3 years to April 2016 have been reviewed
Maurice Blackburn: “The report also did not look at conflicted incentives.”
- As we stated in our submission to the Inquiry, on the basis of an independent report, the CommInsure Board concluded that the report had not identified issues with KPIs that would drive undesirable outcomes for customers.
- Claims staff do not receive financial incentives for declining claims or delaying claims assessments.
Maurice Blackburn: “This report offers the view that such outdated definitions were consistent with competitors…that again is unacceptable.”
- In May 2014 CommInsure’s heart attack definitions were consistent with a number of competitors.
- In March 2016 we accelerated a planned update to our heart attack definition, backdated to May 2014. We then wrote to advise 600,000 current and former customers of this update.
- CommInsure actively searched for previously declined trauma claims and have paid $2.5 million to 17 eligible customers based on the changed definition.
- Importantly, we advocate for the development of standard medical definitions, under the Life Insurance Code of Practice.
Claim: ‘Customers were not contacted or represented as part of the review process.”
- The Deloitte review was commissioned to assess CommInsure’s claims handling systems, processes and customer advocacy principles as well as declined claims outcomes.
- Deloitte says “The process considered the contractual obligations of CMLA, including the requirement to act in utmost good faith, give due priority to policy holders when considering each claims, and also considered good customer advocacy.”
- For Deloitte the process of review involved full access to data, claims files, emails, customer correspondence, doctors reports etc.
- Deloitte interviewed claims staff.
- All information was made available to Deloitte to make a decision on the claim
- If through this process Deloitte felt that more information was required, whether that be from the customer or from CommInsure, particularly if they felt it was needed to decide on a claim, they would request it of us.
- CommInsure would contact the customer (or through their trustee) and provide that information to Deloitte. It is not appropriate for Deloitte to contact our customers directly.
- It is entirely incorrect to say there has been no contact with customers.