CALI outlines Life Code changes

Australia's life insurers have set out their action plan with an aim to strengthen their commitments to customers under the Life Insurance Code of Practice (Life Code), following an independent review commissioned by the industry.

The industry has committed to better claims processes, greater clarity for customers about mental ill-health and cover, improved access to information and assistance for First Nations peoples, and stronger independent oversight through upcoming changes to the Life Code.

The Council of Australian Life Insurers (CALI) commissioned the independent review to test the Life Code's commitments to customers.

"Australia's life insurers support a strong, clear, and accountable Life Code that protects people when they need it most," said CALI chief executive Christine Cupitt.

"We initiated this independent review because trusted industries listen, test their commitments, and improve."

Led by Peter Kell, the review made 85 recommendations. CALI said the life insurance industry supports the majority of the recommendations, with further work and consultation on more complex recommendations to wrap up in the first half of 2027.

Cupitt told Financial Standard the reason for not immediately implementing some of the changes is to allow time for the industry to "get it right".

"The test of the Life Code is the benefits that it provides for our customers. So, it's important that we take time on the more complex measures to get them right," Cupitt said.

"There are four priority workstreams that we included in our response. The first covers some of the mental health recommendations, and again, these are important to get right. The extra process that we'll have will take into account more customer perspectives. It's also a recommendation of the reviewer himself that we conduct a further process around some of his recommendations.

"So that'll be a very important piece of work, and we'll do that in consultation with our members, with mental health stakeholders, and with other stakeholders."

Cupitt said there was also more work to be done around claims handling recommendations, so another priority workstream has been established around those recommendations.

"There are a number of them, they are complex, and many of them overlap and overlap with our legal obligations. So, we really want to take the time to work methodically through those and make sure that they are ultimately going to deliver a more practical experience for customers who are working their way through a claim," she said.

Cupitt said the Life Code must keep pace with changing community needs and expectations.

"We will implement changes to deliver meaningful improvements for the life insurance customers we serve every day and to strengthen the Life Code overall."

Some of the changes include improving how claims processes work in practice; offering tailored support earlier to customers experiencing financial difficulties; access to a real person with the right knowledge to help during a claim; making it easier for First Nations peoples to find information and support; stronger privacy and safety protections for people experiencing family and domestic violence; clearer, more useful information about what customers are covered for, how much life insurance costs, and how discounts may affect future costs; and greater accountability, including broadening the powers of the Life Code Compliance Committee

"Throughout this process, it is essential customers remain at the centre of all our discussions, particularly those with lived experience," Cupitt said.

"As we continue to work on final drafting of the updated Life Code, we will be focused on bringing consumer voices, lived experience, specialist expertise, regulators, and our industry together.

"A better Life Code does not mean a longer or more complex Life Code. The real test is the difference it makes for customers."