“Incorrect outcomes” led to 53% of reversed decisions on trauma claims and 48% of overturned claims in disability income, the prudential regulator’s latest data shows. 

The proportion for death claims was 31%, followed by total and permanent disability (28%), accident (25%) and funeral (20%).

The Australian Prudential Regulation Authority claim and dispute statistics cover the year to June 30.

Overturned claims are a major focus for the Life Insurance Code Compliance Committee, which has announced an inquiry into reversals handled internally by insurers and externally by the industry ombudsman. 

The prudential update shows death cover has a claims paid ratio of 55% across all distribution channels; TPD 91%; trauma 56%; disability income 79%; consumer credit insurance 34%; funeral 36%; and accident 20%.

Individual advised death claims during the period averaged $577,000; TPD $849,000; trauma $275,000; disability income $8000 (expressed as a monthly benefit); and accident $509,000.

For individual non-advised products, death claims averaged $249,000; TPD $432,000; trauma $73,000; disability income $5000; consumer credit insurance $36,000; funeral $10,000; and accident $66,000.