Final report into Life Code makes 85 recommendations

The final report of an independent review of the Life Insurance Code of Practice (Life Code) has been finalised, proposing some 85 recommendations across aspects of mental health, customer vulnerability, claims handling, and sales practices.

The review, initiated by the Council of Australian Life Insurers (CALI), commenced in October 2025, was spearheaded by former ASIC deputy chair Peter Kell.

Explaining the findings of the report, Kell said the approach to mental health was an area of particular focus in the report, in light of the challenges to sustainability as claims have increased significantly recently.

"However, there are aspects of this issue that cannot simply be resolved at this point through a change to the code but rather will require industry to engage with stakeholders to consider in more detail an appropriate path forward that supports both sustainability and the fair treatment of customers," Kell said.

Kell took into the account of the current blanket mental health exclusions in the code and noted that the current clause is perceived differently by many.

He said CALI also acknowledged this clause "is widely understood to prohibit terms and conditions in standard form contracts that exclude or limit coverage for mental health conditions above and beyond the requirements of the Disability Discrimination Act 1992 (DDA).

In response to that, Kell recommended a commitment in the code to comply with the DDA and a prohibition on the complete exclusion of mental health cover in standard form contracts, even if consistent with the DDA.

Kell also advised the Life Code Compliance Committee should consider a review in this area prior to the next review.

Commenting, Kell said the review is crucial to provide guidance for insurers, as the code plays an important role in setting out life insurers' commitments, which include "high level" statements of principle that act as guardrails for many of them.

"The extent of interest and detailed input into the review from a wide range of stakeholders indicates the significance that stakeholders place on the Life Code," Kell said.

"It is seen as a key initiative from the life insurance industry to build trust and confidence, but there are clear expectations that the code should continue to improve to meet evolving customer and community standards."

CALI welcomed the findings, stating it is an important milestone in strengthening customer protection and maintaining trust in the industry.

CALI chief executive Christine Cupitt thanked Kell for leading a robust and inclusive review process.

"The Life Code is central to continued trust between life insurers and the Australians they protect, and we thank Peter Kell for the expertise, independence, and engagement he has brought to this review," Cupitt said.

"Many people and organisations have contributed their time, insights, and expertise to the review. We will continue to engage with them as the industry now carefully considers the final report and its 85 recommendations.

"Our focus will be to ensure any changes to the Life Code strengthen customer protections and are designed and implemented in a way that supports the long-term affordability and accessibility of life insurance for Australians."

The initial industry response to the final report will be available on 30 September 2026.

The final report follows the interim report published in April, highlighting rising mental health claims.