A proposed rule change allowing the ombudsman service to name companies that fail to comply with decisions would improve transparency and accountability, the National Insurance Brokers Association says.

The Australian Financial Complaints Authority is consulting on the change, which if accepted would take effect from no later than March 12 next year.

“Non-compliance with a determination undermines confidence in the system and disadvantages consumers and small businesses who rely on AFCA to obtain fair outcomes,” NIBA says.

“The proposed change will provide greater visibility of firms that do not meet their obligations, support AFCA in enforcing compliance, and promote fairness across the sector by recognising those firms that do meet their responsibilities under the scheme.”

Companies that do not comply with rulings are reported by AFCA to the Australian Securities and Investments Commission.

Between April 1 last year and March 31 this year, the authority reported 64 such businesses.

NIBA also supports proposed rule changes around paid representatives, including that they use communication channels required by AFCA.

“Ensuring the use of these channels will support more streamlined complaint handling, reduce delays and improve outcomes for all parties involved, including complainants and financial firms,” the association says.

AFCA’s definition of paid representatives includes insurance claim handling companies, but it does not include accountants, lawyers, financial counsellors or other representatives that have professional bodies to monitor their conduct.  

The submission is available here.