Co-author: William Jolly
What is the General Insurance Code of Practice?
The General Insurance Code of Practice is the instrument by which the general insurance industry sets standards for its own conduct.
It outlines the minimum standards of service that you should expect from insurers when buying and renewing insurance, making claims, and handling complaints.
The Code was introduced back in 1994, and has since been independently reviewed 5 times – in 1998, 2006, 2009, 2012, and most recently in 2014.
The code is written in plain English and you can read the entirety of this code of practice by visiting the General Insurance Code of Conduct website. At the time of our latest update, the Insurance Council of Australia was planning to finalise a new review of the code in mid-2017.
What types of insurance does the Code cover?
The General Insurance Code of Practice covers nearly all types of general insurance, including:
- Motor vehicle insurance (comprehensive and third-party property)
- Home building insurance
- Home contents insurance
- Sickness and accident (does not cover health insurance or life insurance)
- Consumer credit insurance
- Travel insurance
- Personal and domestic property insurance (does not cover workers’ compensation)
We compare almost all of these types of insurance on our website so that you can find the right product and the right provider for your situation.
The only types of insurance that aren’t covered by the Code either don’t affect customers or have specific laws and regulations under government statutes, such as:
- Health insurance
- Life insurance
- Motor vehicle injury insurance (CTP or Green Slip car insurance)
- Marine insurance
- Medical indemnity insurance
- Workers’ compensation
- Reinsurance (insurance for insurers)
Because the Code doesn’t cover these insurances, there is all the more reason to compare your options and find the right product and the right provider to suit your needs:
Which insurance companies must follow the Code?
A large number of insurance companies, industry participants, and affiliated organisations subscribe to the Code of Practice, meaning they have to follow the Code. Subscription is mandatory for members of the Insurance Council of Australia (ICA) who offer any products covered by the Code.
The list of companies who have adopted the code is far too numerous to list them all here, but you can find the complete list on the Code of Practice website. The majority of the big insurance providers in Australia are on the list, including Allianz, QBE, RACQ, Westpac, and many more.
Any other industry participants may also subscribe at any time, and the ICA encourages all general insurers to adopt the Code.
How is the Insurance Code of Practice enforced?
The Code is enforced by the Code Governance Committee (CGC), an independent body that monitors and enforces insurers’ compliance with the code.
The Code is binding on any ICA member companies that offer products covered by the Code, and if they have been found to be in breach of the code, action is taken in two steps:
- Members are ordered by the CGC to take corrective action
- Breaches that are not corrected are subject to sanctions at the discretion of the CGC
What are the Code’s financial hardship provisions?
The updated Code includes provisions introduced in order to help consumers who are suffering from financial hardship, which was not present in the previous version of the Code.
If you’re experiencing financial hardship (which is generally defined as having difficulty meeting your financial obligations to an insurer), the provisions in the Code require insurers to try and provide assistance to you.
If the insurer decides you are entitled to some form of financial hardship assistance, you and the insurer will then work together to decide on a payment arrangement, which could take the form of:
- Extending the due date of the payment
- An instalment plan for payment
- A reduced lump sum payment
It’s important to note that the financial hardship provisions contained in the Code do not apply to unpaid general insurance premiums.