The corporate regulator has suggested it will not intervene after a refund company criticised the dispute authority’s add-on insurance deadline.

As insuranceNEWS.com.au has reported, the Australian Financial Complaints Authority introduced the cut-off on June 30 this year to limit legacy complaints from before the Hayne royal commission report in 2019. 

Refund specialist Claimo, which submitted 8000 complaints to AFCA last financial year, has attacked the deadline, arguing it is “arbitrary” and denies thousands of consumers fair treatment. The move also damages the business model of Claimo, which takes 30% plus GST from every settlement.

Claimo says that without the possibility of escalation to AFCA, banks and insurers are now refusing to settle legitimate complaints, and it has written to the Australian Securities and Investments Commission to flag concerns.

However, ASIC told insuranceNEWS.com.au its oversight of AFCA is limited by statutory provisions.

“ASIC respects AFCA’s operational independence,” a spokesperson said. “ASIC has published numerous reports about add-on insurance sold through car dealers and has also overseen significant programs of remediation, including in the insurance industry, for low-value insurance, failing to deliver on price discount promises and poor sales practices. 

“We expect financial firms to identify, record and handle complaints in line with their obligations.”