|        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Tereora drives off from life insurance READ ON Dismiss
Last Article Uploaded: Sunday, September 19th, 9:52AM


Latest Headlines

Insurance industry complaints on the rise

The latest Insurance and Financial Services Ombudsman Scheme Annual report has been released showing accepted complaints have increased by 25% across the insurance industry.

Friday, September 10th 2021, 1:46PM 3 Comments

by Matthew Martin

Insurance and Financial Services Ombudsman (IFSO) Karen Stevens says most complaints this year were about insurance, with an 18% total increase in complaints accepted by the IFSO.

Stevens says the lift can be attributed to growing consumer awareness of the Financial Markets Authority's focus on conduct and culture, as well as the Insurance Council of New Zealand's Fair Insurance Code.

Overall, complaint enquiries were down 8% from the year before, from 3922 in 2020 to 3626 in 2021.

However, total accepted complaints went up by 18% in 2021 with 334 complaints accepted compared to 274 in 2020 but were up 25% across the life and health and fire and general insurance sectors.

In the health and life sectors, 105 complaints were accepted (see breakdown below) with 33 complaints about life insurance, 24 for health and 22 for income protection.

199 complaints were accepted in the fire and general insurance sector, the bulk of those (63) were for motor vehicle claims, 49 for travel claims and 45 for house insurance claims.

Stevens says some complaint issues remain constant.

“Consumers often don’t understand what the policy covers and how exclusions can cut out the cover they thought they had.

"People must carefully read what is on offer. This ensures the policy they are buying is the policy they need.”

She says complaints often reflect a misunderstanding of insurance terms, however, she says most providers are “quick to resolve and settle complaints when we contact them, which demonstrates a mature level of customer service".

Stevens says with covid, climate change, increasing natural disasters, cyber-security threats and regulatory changes the industry is having to respond quickly to many changes.

IFSO Scheme Commission chairperson Sue Suckling says the 2020/21 year has been demanding with the ongoing uncertainty associated with covid, system changes and pressures.

"New regulation and controls are underway for financial service providers, and the global focus on improved conduct and culture has impacted all participants," says Suckling in the report.

"This year, the IFSO Scheme received a surge in complaints, and our specialist team worked hard to maintain complaint closure rates."

She says resolution times were extended beyond set benchmarks.

"Mindful of the severe business disruption caused by the global pandemic, the Commission has not increased participant levies in the past two years.

"Anticipating the compliance burden faced by financial advice providers with the implementation of FSLAA, the Commission approved a restructure of annual levies for the advice sector that saw a reduction in the standard adviser levy rate, with volume discounts," she says.

Accepted complaints in the health and life sectors:
Life: 33
Health: 24
Income protection: 22
Trauma: 15
Mortgage/Loan/Credit card protection: 11

Accepted complaint issues in the health and life sectors:
Policy exclusion: 20
Non-disclosure: 18
Premiums: 17
Scope of cover: 15
Misselling/Misleading info/misrepresentation: 13
Pre-existing condition: 10
Prima facie claim: 7
Reasonable decision: 4
Policy limits: 2
Interpretation of contract terms: 3
Customer services issues: 2

Tags: complaints health insurance IFSO Life insurance

« Asteron Life support businesses with premium relief optionsCigna NZ announces two new deals »

Special Offers

Comments from our readers

On 13 September 2021 at 12:31 pm Graeme Lindsay said:
Whilst the breakdown in complaint numbers by sector is interesting, I suggest that a breakdown of complaint against insurers as opposed to complaints against advisers would be equally interesting!
On 13 September 2021 at 12:48 pm Dirty Harry said:
The big increase in claims around travel should be no surprise, and also exceptional in year-year stats. Growing numbers of MV accidents is also a long run trend, so will be growth in the number of claims. IoW: how many of this "increase" is newsworthy?

Further: Stevens says the lift can be attributed to growing consumer awareness of the Financial Markets Authority's focus on conduct and culture, as well as the Insurance Council of New Zealand's Fair Insurance Code.

Oh really?
These same consumers who "often don’t understand what the policy covers and how exclusions can cut out the cover they thought they had"... DO understand CoFI and ICNZ code? LOL

Overall complaint numbers were down, even while complaints accepted went up. This is good news really - it means the Karens had better things to do (than complain to IFSO).
On 13 September 2021 at 1:26 pm Dirty Harry said:
oh, and BTW

of the 334 complaints accepted, 9 were against Financial Advisers.

Number of Advisers in the IFSO scheme: 1889

What we can't see is how many were upheld, and what sector those advisers came from.

Sign In to add your comment



Printable version  


Email to a friend
Insurance Briefs

FMA licensing workshops popular with Fidelity Life advisers
A series of online licensing support workshops jointly hosted by Fidelity Life and the Financial Markets Authority have attracted almost 200 adviser registrations.

Check your cover and win a prize - ICNZ
This week is Money Week and the Insurance Council of New Zealand (ICNZ) is encouraging New Zealanders to make one day their ‘Insurance Day’ to ensure their insurance meets their needs.

Tower hits the water with boat insurance offering
Tower Insurance has announced it will now be offering boat insurance policies online. 

$10k scholarship for insurance professionals opens
Submissions are now open for a scholarship designed to support the professional growth and development of insurance industry practitioners in New Zealand.

News Bites
Latest Comments
Subscribe Now

Cover Notes - Specific news aimed at risk advisers

Previous News


Most Commented On
About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox  |  Disclaimer
Site by Web Developer and