Life insurers have told the industry code reviewer the document must keep up with regulatory changes and consumer expectations.

Consultation on the review of enforceable conduct and best practice benchmarks in the code closed yesterday, and industry peak body the Council of Australian Life Insurers has welcomed it as an opportunity to hear from the community, consumer advocates and regulators.

“The life code is central to continued trust between life insurers and the Australians they protect,” CEO Christine Cupitt said.

“For the life code to remain strong, relevant and trusted, it must continue to meet the needs of Australians, keep pace with regulatory change and reflect what the community expects from our industry.”

CALI’s submission says it supports “evolving the code to provide the right protections for customers in an accessible, understandable way. This includes protections for people experiencing vulnerability, financial hardship or mental ill-health. 

“The submission also highlights areas where clearer language, simpler structure and better alignment with the law could improve understanding, consistency and confidence for customers, without reducing existing protections.”

Former regulator Peter Kell is leading the review of the voluntary code, which CALI announced in July. 

After the last review, more than 50 consumer protection measures – including a penalty of up to $100,000 for significant breaches – were added to the code that took effect in 2023.

Mr Kell will now prepare an interim report for further consultation early next year.

The latest consultation paper listed mental health protections, claims handling, medical definitions and complaints handling among its focus areas. Enforceability of the code is another key issue.

“While the life insurance industry has not sought [Australian Securities and Investments Commission] approval of the current code, this review is being conducted in a manner intended to support an application for code approval should CALI seek to do so once the review is concluded,” the paper says.

Feedback was also sought on the effectiveness of the Life Code Compliance Committee.

“The LCCC’s role is critical to support and ensure compliance with the code,” the consultation paper says.

“The reviewer is interested in the overall effectiveness of the LCCC and any changes that would enhance its role.”

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