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Melbourne lockdown: industry fears claims impact

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The industry is pressing the Victorian Government to include in its business guidance a definition of critical insurance services that can still be provided during the current stage four lockdown.

The Insurance Council of Australia (ICA) has been engaged in talks with the Andrews Government since last week to ensure essential insurance-related work can still go on during the six-week lockdown.

It wants the definition in the government guidance to refer to the provision of insurance, claims handling and repair services, claims settlements and payments, customer support services, operational, reporting, communications, monitoring, maintenance, corporate, support, ancillary and other functions, and support for vulnerable customers and staff.

ICA spokesman Campbell Fuller says having the definition will mean “essential insurance-related work can be undertaken in the best interests of Victorian households and businesses”.

ICA said last week key services such as complaints handling, customer assistance and claims payments would continue to be provided as it held talks with the Government to “clarify some aspects” of restrictions on business activities.

The government addendum of an approved list of financial products and services includes services to customers in hardship, vulnerable customers, call centres for customer transaction handling, enquiries and complaints. These operations, if provided onsite, must be conducted according to a COVID-safe plan.

Mr Fuller says the lack of clarity has given rise to fears claims would not be assessed, potentially exposing insurers to breaches of their disclosure requirements.

“It doesn’t provide them enough certainty about a much broader range of insurance activities that the industry regards as essential and has been able to provide nationally up to this point,” Mr Fuller told insuranceNEWS.com.au.

These include things like sending insurance assessors out to examine damage so that repair and rebuilding can proceed.

“The other concern expressed by insurers is a risk of breaching disclosure requirements and the Insurance Contracts Act if they’re unable to provide these services,” he said. “If something is in the product disclosure statement and the insurer is unable to fulfil the contract they risk a legal breach.”

Melbourne-based Claims service provider Proclaim’s MD Jon Broome says his loss adjusters are attending to urgent claim situations with permits from employers.

“There is also provision to attend if a business is operating as essential and repairs are required, so we are comfortable we can navigate around the claims in the next few weeks,” he told insuranceNEWS.com.au today.