“Recurring problems” in claims handling remain a priority for the Life Code Compliance Committee, according to the independent watchdog’s 2025-26 annual report.

The committee has already launched a review of claims practices and expects to release the findings this financial year.

“There is still important work ahead,” chair Jan McClelland said of the committee’s focus areas.

“Claims remain a clear priority, with our data continuing to show problems with timely benefit payments, communication and complaints handling.

“We will publish further work from the inquiry into claims handling already under way, while the continuing development of the new code will provide another important opportunity to strengthen protections for customers.”

The report says the committee acted in FY26 on serious non-compliance, and two unnamed insurers were sanctioned for major breaches of the code.

“We considered not only individual matters but also the broader systemic issues that carry wider consequences for consumers and industry practice,” Ms McClelland said.

“During the year, we reviewed 14 significant breaches reported by insurers and finalised eight of those reviews.

“The matters highlighted recurring weaknesses across claims handling, annual renewal notices, legacy system migrations and customer communications, including problems that pointed to broader issues in insurer systems, controls and governance.”

The report says the committee received code breach allegations from customers, their representatives and other members of the public.

“In 2025-26, we reviewed 120 allegations and finalised 111. Claims accounted for 69% of the allegations we finalised, while vulnerability and hardship accounted for a further 19%. The allegations led to nine individual investigations and three targeted reviews, with two significant breaches reported by insurers,” the report says.