The Australian Consumers Insurance Lobby (ACIL) has renewed pressure on the Australian Financial Complaints Authority (AFCA) to overhaul the way expert reports are managed in claims disputes.
The group argues that the system leaves policyholders disadvantaged when challenging insurer-appointed specialists.
AFCA is consulting on its Approach to General Insurance Claims Handling, which outlines how it assesses matters such as expert evidence, settlement options, claim delays, and non-financial loss.
While the framework aims to give clarity to insurers and consumers, ACIL said it does not go far enough to address systemic power imbalances.
ACIL chair Tyrone Shandiman said the reliance on insurer-funded assessments undermines fairness.
“Consumers face an impossible task. Unless they can afford their own expert report – which is often prohibitively expensive – they are left to challenge insurer evidence that AFCA without any professional counter-point is almost too often obliged to accepts at face value. That system needs to undergo fundamental change,” he said.
The lobby group has written to the Australian Securities and Investments Commission (ASIC) seeking clearer requirements for AFCA.
Its recommendations include having insurers pay for independent reports, reimbursing consumer expenses for expert evidence, requiring disclosure of conflicts of interest, and recording repeat use of experts whose reports are contested.
Regulators have also pointed to weaknesses in insurers’ oversight of third-party specialists.
A 2025 ASIC review found that insurers often had no systematic method for testing the reliability of expert assessments and rarely re-examined reports once relied on for claims decisions.
These findings mirror earlier observations from the General Insurance Code Governance Committee (IBCCC), which documented ongoing concerns around expert evidence in disputes.
Shandiman said the problems remain widespread.
“That is why we have written to ASIC asking it to provide greater direction to AFCA to ensure fair practices are applied when expert evidence is in dispute,” he said.
Although the industry introduced an Expert Report Standard last year, ACIL maintains it lacks enforceability because compliance depends on insurers rather than experts themselves.
Alongside the consultation, AFCA recently released its annual figures showing 100,745 complaints in 2024–25. While this is a 4% decline from the previous year’s record, volumes have stayed above 100,000 for two consecutive years.
General insurance accounted for 34,231 complaints, up 17% year on year. Disputes commonly involved motor vehicle claims, with delays linked to shortages of parts and repair capacity. Comprehensive car cover was the most disputed product.
Chief ombudsman and CEO David Locke said insurers need to improve communication with customers, particularly around claim delays.
“Firms have more work to do to ensure fair responses to complaints are delivered earlier, without people having to take the extra step of coming to us,” he said.
ACIL has warned that without stronger measures, consumer groups may push for government-appointed experts to represent policyholders in disputes.
ASIC Commissioner Alan Kirkland said insurers are already required to provide straightforward explanations of settlement options.
“Insurers by law must provide a cash settlement fact sheet, which outlines options for settlement to customers who have made a claim. Those options should be explained in terms the customer can understand, rather than pointing to complex product disclosure statements,” he said.
