The Insurance Brokers Code Compliance Committee (IBCCC) has released its 2022 Annual Data Report, highlighting its concerns about reporting practices.
The report was based on data sourced from Australian insurance brokers code subscribers' Annual Compliance Statements (ACS). It revealed that 175 brokers reported no breaches, while 152 reported no complaints in the reporting period.
The IBCCC welcomed the increased number of brokers reporting breaches and complaints, but expressed concerns about too many reports claiming to have received zero complaints or breaches.
“The numbers are worrying and prompt important questions about the thoroughness of self-assessment. Are all issues being accurately reported? Transparency is paramount in maintaining trust within our industry,” said IBCCC Chair Oscar Shub.
The most frequently reported breaches in 2022 were related to purchasing insurance, managing claims, and adherence to legal requirements.
These three reported breaches accounted for 78% of all reported breaches in the 2022 reporting period.
Even though more brokers reported breaches and complaints in 2022, the IBCCC said there is still room for improvement around the diversity and effectiveness of the compliance frameworks in place across the Australian insurance broking industry. It said that accurately identifying, reporting, and recording breaches are key aspects of the regulatory model.
“We urge our subscribers to shift their focus from simply identifying the ‘who’ and ‘what’ of breaches to understanding why they occur. This shift in perspective can lead to more effective preventive measures and ultimately better consumer outcomes,” Shub said.
With the 2022 insurance broker code already in effect, the IBCCC predicts the number of breaches for 2023 to rise.
“Regulatory changes often require a period of adjustment as industry adapts and integrates new compliance measures. An increase in reported breaches will demonstrate that insurance brokers are aligning their businesses with the updated standards,” Shub said.
