The General Insurance Code Governance Committee (CGC) has advocated that insurers improve their oversight of external experts following the release of its latest report, “Oversight of External Experts.” This report, a follow-up to the CGC’s 2022 inquiry, has underscored ongoing concerns about the quality and scope of expert opinions used in insurance claims assessments.
The CGC’s findings indicate that external experts have occasionally provided opinions extending beyond their areas of expertise, potentially affecting the fairness and accuracy of claims decisions. The report highlighted instances where such overreach could lead to poor claims outcomes.
Veronique Ingram, chair of the CGC, emphasised the importance of restricting expert opinions to their specialised fields. “External experts play a crucial role, but it is critical that their views on a claim don’t go beyond their field of expertise,” Ingram said.
“Insurers should take steps to ensure this. It will help enhance the quality of claims assessments and will work to protect the integrity of the process.”
The report also highlighted deficiencies in the training provided to external experts by insurers. It has recommended that insurers enhance their training programs to ensure experts understand their roles and responsibilities thoroughly, and that they receive continuous education beyond initial training.
“Effective training is the foundation of reliable claims assessments,” Ingram said. “Insurers have a responsibility to ensure that their external experts receive comprehensive training and ongoing education to maintain high standards of service.”
Furthermore, the CGC observed that insurers’ quality assurance processes often prioritize cost and time efficiency over the quality of work by external experts. The report suggested improvements to balance quality with efficiency.
“While efficiency is important, it should not come at the expense of quality,” Ingram said. “We expect that insurers’ quality assurance processes are comprehensive and incentivise work of the highest standards from external experts.”
The CGC commended the Insurance Council of Australia (ICA) for its recent publication of updated guidance and standards aimed at improving practices in the use of external experts.
“The new guidance and standards from the ICA demonstrate a real push for better use of external experts in the industry,” Ingram said. “When insurers read these publications in combination with the recommendations in our report, they will have a clear view of the expectations for the use of external experts.”
The CGC has expressed intentions to continue monitoring insurers’ adherence to these recommendations and the overall performance in claims handling.
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