You might remember that the Royal Commission into Misconduct into the Banking, Superannuation and Financial Services Industry revealed some truly appalling behaviour by previously trusted institutions, including insurers. Fast forward a few years, and – if you follow the news – you could be forgiven for believing that they have totally cleaned up their act, and that all the bad behaviour has ended. Unfortunately, our experience is that that’s not always the case.

At Littles, we help hard-working Australians understand what their rights are, including when it comes to making claims for insurance – whether it is life insurance, income insurance or total and permanent disability (TPD) insurance. Frequently, clients come to us stressed, upset and despondent about how they have been treated by insurers. This includes unreasonable delays and having their claims rejected on spurious grounds.

In these situations, there are a number of options, including making a complaint to the Australian Financial Complaints Authority (AFCA). AFCA essentially acts as the ‘middle man’ between financial firms and consumers or small businesses, offering free and independent dispute resolution services. This blog explores what you need to know about making an AFCA complaint, and other support that is available to you to help get your entitlements.

About AFCA

AFCA is an Australian Government entity that deals with complaints about financial advice, insurance, banking and superannuation products and services provided by ‘financial firms’. It replaced a number of existing bodies, including the Financial Ombudsman and Superannuation Complaints Tribunal. The time limit to lodge a complaint to AFCA is usually between two and six years. To lodge a complaint, you must follow AFCA’s process. Before considering a complaint, AFCA must confirm that your complaint is one it can deal with under AFCA’s Complaint Resolution Scheme Rules.

Contact your financial firm

If you have a problem with how your insurer or financial firm has dealt with you, it is important to contact them directly first before contacting AFCA. They must in turn reply within a specific timeframe:

· 90 days for superannuation or traditional trustee complaints

· 21 days for complaints involving financial difficulty, or

· 45 days for all other complaints.

If your insurer does not reply within the timeframe, or you are unhappy with the reply, you can contact AFCA.

How to lodge a complaint with AFCA

Make your complaint. You can lodge a complaint with the AFCA using their online form or by email, telephone or fax. It is important to clearly identify your problem, and think about what loss you have suffered. You should also collect all relevant documents to support your claim and lodge a Statement of Financial Position if you are experiencing financial difficulty.

AFCA will consider your complaint: At first instance, AFCA will usually refer your complaint back to the insurer or financial firm. It will be given 21 days to work directly with you to reach a resolution. AFCA may ask you or your insurer for more information.

Facilitating negotiations: If a resolution is not met, AFCA may facilitate negotiations between you and your insurer or financial firm by exchanging settlement offers and discussing them with both sides, or AFCA may hold a telephone conciliation conference.
Resolving the complaint: If negotiations or conciliation fails, AFCA will generally make a preliminary assessment and give you and your insurer or financial firm a chance to accept or reject the assessment. This assessment may include determining that:
· correcting an error made in an interest rate calculation
· refunding a fee, and
· paying an insurance claim in part or in full
If the assessment is rejected by either side, AFCA will make an enforceable decision about your complaint after considering the relevant laws, codes of practice and information provided by you and your insurer or financial firm. Depending on the nature and complexity of the issue, AFCA will usually make a decision within two to eight weeks.

Still not happy?

For most complaints, AFCA’s decisions are binding on the financial firm, but not on you. If you do not accept the decision, you keep your legal rights to take your complaint to court. While insurers say that the system is designed for people to manage their own claims, there’s little regulation to ensure unrepresented claimants aren’t mistreated. We’ve seen many clients struggle with the convoluted superannuation claims process, and complex legalese in their insurance policies.

If you’re unable to work due to serious injury or illness, you probably want to focus on getting well and looking after your family – you don’t want to spend your time filling out complicated paperwork and providing evidence to support a superannuation insurance claim. The right lawyer can streamline the superannuation claims process, and make your life easier. But remember – not all lawyers are created equal. If you’re going to consult a lawyer, consult an insurance law expert.

Getting in touch with Littles before making a claim can ensure the process proceeds smoothly, and potentially avoid the need for an AFCA complaint. However, Littles can also assist with this, including

· advising you about any financial complaints you have

· assisting you to negotiate a resolution with your financial firm

· providing you with advice about AFCA’s decision about your financial complaint, and

· representing you in any legal proceedings against a financial institution or advisor

Don’t delay – seek advice now

If you have an illness or injury that prevents you from working, you might be worrying about how you are going to pay your bills and put food on the table. You could be entitled to receive a TPD lump sum, as well as other insurance benefits. Get in touch with Littles for a free super claims check. We can help you understand what you’re entitled to. Know where you stand, and get peace of mind.

Free advice and no upfront fees

Not only do we offer a FREE claims check – we handle most insurance claims on a no win, no fee basis. Our Head of TPD and General Insurance, Rowan McDonald, is an insurance law expert. If you think you might have a claim, get in touch with Rowan and his team for high quality legal advice.

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