A Draft Life Insurance Code of Conduct recently released by the Insurance in Superannuation Working Group (ISWG) outlines key standards applying to group disability insurance claims and will be binding on superannuation trustees. This is a welcome expansion on the code originally developed by the Financial Services Council with which it will operate in partnership. This was introduced as a result of the influx of complaints received on the mishandling and mismanagement of claims by life insurers and superannuation trustees.
This draft code of conduct aims to address problems associated with duplicate insurance coverage, handling of superannuation and insurance claims as well as cancellation of coverage. The code also provides for the monitoring of compliance with the code by an independent party as well as requiring all superannuation fund staff and contractors to adhere to the code. The proposal is for this code to start on 1 July 2018 allowing a further transition period of up to 30 June 2019, by when all superannuation trustees must implement the code.
Whilst the submissions have closed for feedback it is proposed that the final code will be approved and published by the end of 2017. The draft code can be viewed at www.aist.asn.au/policy/insurance-in-superannuaiton-working-group-(iswg)/insurance-code-of-practice-and-consultation-paper.aspx.
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