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A few months ago I wrote about my experience of checking my home and contents insurance renewal notice and realising that I was being fleeced. While shifting to a new insurer allowed me to find a much lower premium, I expect to see a steep increase on next year’s renewal notice. People across the country are facing increases of 20% or more, regardless of whether they shop around. There are several factors driving these increases, but as revealed in a recent CHOICE report (see p30), one of the most significant is the increased frequency and severity of extreme weather events like floods, bushfires and cyclones, driven by climate change. People in areas at risk of these events face much bigger problems obtaining insurance they can afford. To understand this better,…
A body made up of leaders from government, industry and consumer organisations has begun convening monthly to support and inform the work of the ACCC’s new anti-scam watchdog. “The National Anti-Scam Centre’s Advisory Board will enable government to work with key industry sectors and consumer organisations to identify emerging scam and fraud issues, share information and coordinate our efforts to better protect consumers,” says ACCC deputy chair Catriona Lowe. Members of the committee include heads of industry groups, law enforcement representatives, victim support advocates, and leaders of consumer organisations, including CHOICE CEO Alan Kirkland. their tactics, a coordinated response across government, law enforcement and the private sector is essential to combat scams more effectively,” says Lowe.…
New CHOICE research reveals that more than half the population suspect they encounter a scam every week, and 88% believe scams have become more sophisticated or harder to spot. Scams cause significant distress and financial hardship for victims, and they’re increasing rapidly and becoming harder to identify. Businesses such as banks, digital platforms and telcos are simply not doing enough to protect consumers. CHOICE is calling on the government to force businesses to do more to keep people safe from scams. This includes requiring banks to reimburse victims when they fail to prevent fraud, and creating incentives for banks to invest in scam prevention. Our research has found that the overwhelming majority of Australians want to see the government force businesses to do more to prevent and detect scams. Add…
Insurance companies are unfairly denying claims based on wear and tear or maintenance exclusions, according to new research. The General Insurance Code Governance Committee found that 55% of denied claims were due to these two exclusions. Veronique Ingram, the independent chair of the Committee, says the quality of the reports used to make these exclusions were “poor”. “We saw too many reports that failed to provide a clear and demonstrable link between the cause of damage and the loss,” she says. Consumer Action Law Centre CEO Stephanie Tonkin says denying claims “causes incredible distress to the people on the wrong end of the insurer’s decisions”. “My advice is if your insurer declines your claim based on an ‘expert’ report, it is worth your while to complain.” The Committee found that…
A record 96,987 complaints about financial services providers were lodged with the Australian Financial Complaints Authority (AFCA) in the year to July 2023. This was an increase of 34% on the previous year. Complaints go to AFCA after customers are unable to resolve the matter with their bank, insurance company, super fund or other financial services provider. “We are deeply concerned by the volume of complaints consumers are having to escalate to AFCA,” chief ombudsman David Locke says. “It’s not fair on consumers and not good for business. We need to see a significant improvement from firms.” The most frequent cause of complaints to AFCA were delays and other issues in insurance claims handling. Complaints of this type jumped by 76%, while overall general insurance complaints rose by 50%. Personal…
When an investment firm says it screens out certain holdings as part of its environmental, social and governance (ESG) criteria, investors with an ethical agenda should be able to trust the claim. If it turns out to be not quite true, that’s called greenwashing. In December 2022, Vanguard Investments Australia copped a $39,960 fine from the Australian Securities and Investments Commission (ASIC) for such conduct, but it seems the lessons weren’t learnt. In late July this year, Vanguard was taken to the Federal Court by ASIC for the same reason. It turned out that some of the bonds in its Ethically Conscious Global Aggregate Bond Index Fund were funding oil and gas exploration. “We know that investors are increasingly seeking investment options that exclude certain industries, and investors need to…
