Annual notices were wrong
More than 10,000 breaches of the Life Insurance Code of Practice have led the Life Insurance Code Compliance Committee to formally warn a life insurer over faulty annual notices.
Across August 2024 to January 2026, customers received notices that were inaccurate, incomplete or sent after policy anniversary dates. The insurer failed to include relevant policy benefits and incorrectly described some customers’ premium arrangements.
In total, the insurer reported 10,105 breaches. According to the committee, annual notices are a key record for customers because they show what a policy covers, what it costs and whether anything has changed.
Life CCC chair Jan McClelland AM said customers depend on those notices to understand their cover. She said errors, omissions and delays can leave people unsure about the insurance protection they rely on.
A large migration of legacy insurance products sat behind the failures. The committee found weaknesses in the insurer’s systems, compliance oversight and assurance arrangements during that work.
Third-party delays caused 4,686 breaches
Delays by a provider hired to distribute the notices made up 4,686 of the breaches. However, the committee said insurers still need clear oversight of every party involved in sending essential customer communications.
The problem first came to light after a customer complaint. Following that complaint, the insurer investigated, found more breaches and reported them as the review continued.
Ms McClelland said major operational changes need careful planning, effective controls and active compliance oversight. She said product migrations can involve complex systems and large volumes of customer information, but that complexity does not excuse inaccurate or late notices.
As a sanction, the Life CCC issued a formal warning and ordered the insurer to show that its governance, controls and assurance arrangements can stop the problem happening again. The committee will now test whether the remedial steps are effective and capable of preventing further non-compliance.
Since identifying the issue, the insurer has updated annual notices, corrected policy information and sent corrected notices and other communications to affected customers. It has also moved to strengthen its systems, monitoring and oversight of the third-party distributor.
Ms McClelland said the warning reflects the scale and length of the failures, the control weaknesses behind them and the importance of the code obligations involved. She said stronger enforcement action may follow if the insurer breaches the code again.
