Can you guess the number one reason home insurance claims are denied?
New figures from the General Insurance Code of Practice have revealed that home insurance claims are at an all new high.
The report found that home insurance claims were the second-largest proportion of claims within 2016-2017, with a total of 865,127 claims being filed, increasing by 7% from the previous year.
And even though the percentage of claims that were accepted sat at a strong 92.8%, this was actually down 0.1% from the previous year.
Aussies also claimed big on their possessions, with 677,000 contents insurance claims filed between 2016-2017 - a massive 29% increase from the previous year.
However, while a number of Aussies continued to submit claims, 9% of them were declined - meaning home insurance accounted for more than one third of all declined insurance claims.
One of the top reasons both home and contents insurance claims were rejected was because Aussie customers failed to read the fine print, meaning they were either not covered for an event or it proved an exclusion on their policy.
“In 2017−18, the Committee would like to see Code subscribers improving the completeness and consistency of data on withdrawn and declined claims. Central to this will be efforts to develop a shared definition of partially accepted claims,” said Chair of the General Insurance Code of Governance Committee (GICGC), Lynelle Briggs.
The report also analysed and made recommendations as to how the current claims process could be improved, some of which included:
- Maintaining a timely claims process to minimise any emotional or financial disadvantage experienced by a customer
- Keeping customers informed during the claims process
- Informing customers of denied claims
“This highlights the need for Code subscribers to maintain rigorous compliance frameworks for claims handling and do more to prepare for influxes of claims so that service standards are maintained during times of high claims volume,” said Briggs.
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