International insurance ombudsman schemes can learn from the Australian Financial Complaints Authority's approach to resolving disputes, according to the winner of the Australian Insurance Law Association (AILA) Gill Award.
The winner, Scott Breihl, is an associate at Turks in Sydney. He wrote a paper revolving around what insurance ombudsman schemes across the globe can learn from the “Australian experiment with fairness.”
In his paper, Breihl argued that AFCA can effectively “ignore the law,” noting that it is a world-leading insurance ombudsman scheme with mandatory membership, significant monetary jurisdiction up to AU$1 million, extensive compensation powers, and the discretion to depart from legal principles under its “fair in all circumstances” principle.
“It is not bound by prior decisions, nor are its decisions subject to appeal,” he wrote. “This Australian fairness experiment has provided increased consumer protection and outcomes but has also resulted in a nebulous notion of fairness not represented in law, contract, or industry codes taking precedence over procedural fairness.”
Breihl further argued that international insurance ombudsman schemes should benchmark “the Australian experiment with fairness” against their own and consider several lessons, including adhering to “stated decision-making criteria equally in considering what is fair in all circumstances rather than allowing notions of fairness from an outcome perspective to override a scheme's rules.”
He added that schemes must ensure consistent decision-making and have visible, independent, forward-looking review mechanisms accessible by insurers and consumer groups.
Breihl won a $10,000 prize, enabling him to attend international insurance law association AIDA's event and present the paper to the association's consumer protection and dispute resolution working party.
Another AILA award winner, Charlotte Hall, took home the Ron Shorter Award for professionalism in public speaking in September 2022 by identifying five technology trends that will have a “seismic impact” on the insurance industry.
