Super’s Biggest Challenges in Insurance Claim Handling

Super’s Biggest Challenges in Insurance Claim Handling

The introduction of the Insurance in Superannuation Voluntary Code of Practice has meant greater consequences for funds that fail to comply. Should the Code become binding and enforceable, as recommended by the Royal Commission, then the consequences of non-compliance go one to become far more significant. It is more important than ever that funds have the right tools and processes in place to ensure they are able to make the right calls.

Last week, IQ Group ran their second discussion group on Claims Handling under the Code of Practice. Attendees of the discussion covered the range of challenges they were facing and discussed potential solutions. Here are some of the biggest challenges that were identified.

Reduced Claims Handling Timeframes

With the reduced timelines under the code, it is more important than ever to clarify at an early stage whether a member is making a claim, a complaint or some other contact.

Claims that are lodged late, or that have multiple or changing elements, were identified as being particularly difficult. Managing expectations was identified as key, with participants emphasising that funds shouldn’t make representations they cannot meet.

It may be difficult for large funds to be able to guarantee that a claimant was always able to talk to the same primary contact person, although some are able to do this.

Visibility of Member Information

There was significant discussion around the lack of visibility and access to relevant member information.

It was proposed that there should be a single, comprehensive view of claimant members to improve the member experience and the efficiency of claims handling. During the discussion, it was also was noted that the Insurance in Super Working Group recommended the development of functionality that could be owned by funds and cover all interactions with insurers, administrators, medical, legal and rehabilitation providers.

MAAS is Creating Volumes of Work

New reporting of changes to member details to the ATO (MAAS services) has led to increased reporting of deceased members to super funds – and these increased volumes are likely to continue. Many of these deceased members have died years ago but are only now triggering death claim processes due to the introduction of MAAS.

There is uncertainty about what reasonable steps need to be taken to pay unclaimed death monies (eg, notices in newspapers). Trustees need a policy to deal with unpaid death benefits. It was noted that unclaimed death benefits didn’t necessarily involve insurance claims but might just relate to the members superannuation benefit. IQ Group will therefore be drafting an unclaimed death monies policy and we will be providing this to those that participated in the recent claims handling discussion groups.

Identifying Vulnerable Members

There was discussion around how funds addressed vulnerable consumers. As the identification of a vulnerable member can be somewhat subjective, it is an area that warrants further discussion and definition. Vulnerable members need to be clearly identified, along with a rationale for their inclusion and an articulation of their additional needs. The discussion group identified a need for adequate reporting tools (eg, in workflow management systems) to capture these members and their contacts with the fund.

If you have identified any of these issues in your claims handling processes and would like to discuss possible solutions to these issues, you can reach out to us at