Consumer Protection in Insurance Contracts: The Need for a ‘Treating Customers Fairly’ Regime

Schmulow Andrew (), Dayaram Baladev and Mullen Sian

International Review of Financial Consumers, 2023, vol. 8, issue 1, 47-67

Abstract: In light of the findings of the 2019 Australian Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, consumer protection has been highlighted as an area of particular concern, especially with respect to insurance. This article begins by exploring the current regulatory architecture for insurance consumer protection, including the recent amendments to the Insurance Contracts Act 1984 (Cth) and the Australian Securities and Investments Commission Act 2001 (Cth). Analysis of these changes indicates that there are insufficient protections for consumers, because of a lack of appropriate redress, a lack of corporate cultural change within insurance providers, and weak regulatory enforcement. An examination of the United Kingdom’s ‘treating customers fairly’ regime provides a potential solution to these problems; and which could be relatively easily applied within the Australian context. The authors conclude that the UK TCF regime would adequately address deficiencies in consumer protection in the Australian insurance market and provide better consumer outcomes in the future.

Keywords: Financial consumer protection; insurance contracts; financial system regulation; Treating Customers Fairly; TCF; consumer financial well-being; Banking Royal Commission; Hayne Royal Commission (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:irfinc:v:8:y:2023:i:1:p:47-67:n:1004

DOI: 10.36544/irfc.2023.8-1.4

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