The Insurance Brokers Code Compliance Committee (IBCCC) has taken enforcement action against three insurance brokers for failing to lodge their annual compliance statements by the March 31 deadline – a compliance obligation set under the Insurance Brokers Code of Practice.
This marks the third year in a row the brokers missed the reporting deadline, despite having received multiple reminders and guidance from both the IBCCC and the National Insurance Brokers Association (NIBA).
IBCCC chair Oscar Shub said the persistent non-compliance raises broader concerns.
“Annual compliance statements are not optional. They are a basic and essential obligation for every insurance broker that subscribes to the code,” he said. “When brokers repeatedly fail to meet this commitment, it raises real questions about their systems, their governance, and ultimately, their commitment to professionalism.”
The brokers cited varying challenges, including administrative system issues and workload demands, but the IBCCC concluded that these did not excuse the repeated breaches.
Shub added that chronic delays point to more than just operational hiccups.
“Every business faces competing priorities. But three consecutive years of missing a deadline signals a deeper problem. This was not just a one-off oversight,” he said.
Although the three firms eventually submitted their reports and implemented process improvements, including internal reviews and system updates, the IBCCC stressed that such changes should have been pre-emptive rather than reactive.
“We appreciate the efforts to put things right, but brokers shouldn’t be scrambling after the deadline has passed. They knew of the deadline and should have been able to meet it,” Shub said.
As a result of the breaches, the committee has referred the brokers to the National Insurance Brokers Association (NIBA) for potential further action under its membership rules.
Shub noted the broader improvement across the industry, with missed submissions dropping from 86 in 2023 to 11 in 2024, but warned that ongoing compliance requires sustained focus.
“This outcome should serve as a warning to all brokers. Timely reporting is not a box-ticking exercise – it reflects the integrity of your business and your commitment to the code,” he said.
In a separate development, the Australian Securities and Investments Commission (ASIC) has published findings from its review of how general insurers are managing home insurance claims – particularly those related to the 2022 flood disasters.
The follow-up review assessed progress since ASIC’s 2023 “Navigating the Storm” report (Report 768) and involved seven insurers:
The regulator identified improvements in oversight of builders and repair contractors, but noted that supervision of technical experts – such as engineers and hydrologists – remains inconsistent.
ASIC found that claims teams were often expected to verify expert reports without having the necessary technical knowledge.
In many cases, once a decision was made based on expert input, insurers did not re-evaluate the reports – even when errors could have affected claim outcomes.
ASIC also raised concerns about how insurers communicate cash settlement options to policyholders.
Although insurers are legally required to issue a fact sheet explaining these options, ASIC found that the information provided was often minimal and difficult to understand.
Some insurers had initiated follow-up calls to check whether customers were progressing with repairs post-settlement. However, this practice was not standardised across the sector.
ASIC stressed that insurers must take steps now to address the issues identified, rather than waiting for future disaster events to expose weaknesses.
It has also signalled that enforcement remains active. In April, the commission commenced proceedings against Hollard Insurance Partners over an unresolved 2021 home claim. Investigations into other flood-related cases are continuing.
Meanwhile, the Insurance Council of Australia (ICA) is in the process of developing a revised General Insurance Code of Practice, with a completion target set for 2026.
ASIC has urged insurers not to delay necessary reforms in the interim.
