New Zealand’s Insurance & Financial Services Ombudsman Scheme has reported record demand for its services, with insurance disputes dominating the figures. 

In 2025/26, the IFSO Scheme handled 3977 cases, including 2602 complaints, and  concluded 833 dispute investigations, an increase of 46% compared with the previous year. Dispute volumes have increased almost 190% over the past five years from 2022 to 2026.  

More than 92% of disputes accepted by the IFSO Scheme were insurance related. This compares with 34% insurance in Australian ombudsman AFCA’s latest annual report, where banking and finance generate the most complaints.  

Insurance & Financial Services Ombudsman, Karen Stevens, says that ongoing financial pressure on households is probably driving demand for dispute resolution. 

"While there have been no recent major natural disasters driving complaint volumes, we continue to see record levels of disputes coming to the IFSO Scheme,” she said. 

"Consumers are experiencing financial pressures, which can make the outcome of an insurance decision even more important. We are also seeing growing use of AI tools to make complaints, which have had an impact on the volumes we’re receiving.”  

Ms Stevens says that questions about what insurance policies do and don't cover remain at the heart of many disputes. Scope of cover and policy exclusions were the most common issues in disputes investigated by the scheme.  

“This year we have been reinforcing to consumers that there are some things we can help with, and some things we can’t. Because we can’t change the law or rewrite their contracts, we often cannot give consumers the outcome they’re hoping for. If no cover exists under the policy they took out, we can’t change that,” she said. 

Health insurance became the single largest product category of disputes investigated by the NZ ombudsman for the first time, increasing by 91%, and overtaking both house and motor insurance.   

Travel insurance disputes also increased by 32%. A number of complaints were linked to travel disruptions caused by conflict in the Middle East, as well as disputes involving policy exclusions and the extent of cover available when travel plans were disrupted.  

Ms Stevens says that when the IFSO Scheme cannot deliver the outcome a consumer is seeking, it can still provide an independent review and clear explanation of whether an insurer or financial service provider has acted in line with its obligations.