Insurer sanctioned for over 10k breaches

The Life Insurance Code Compliance Committee (Life CCC) has sanctioned a life insurer after it reported more than 10,000 breaches of the Life Insurance Code of Practice (Life Code) in relation to failure to provide timely, completed annual notices.

According to the Life CCC, the unnamed insurer failed to include relevant policy benefits, accurately describe some customers' premium arrangements and issue notices before policy anniversary dates between August 2024 and January 2026.

These failures led to inaccuracies in cover and premium details as well as delays in issuing notices to customers.

Purportedly, the failures occurred during a large-scale migration of legacy insurance products and reflected weaknesses in the insurer's systems, compliance oversight and assurance arrangements.

The insurer first identified the issue following a customer complaint in April 2025, with a further review identifying the additional breaches, which the insurer reported as its review progressed.

In total, the insurer reported 10,105 breaches. Of these, 4686 breaches related to delays in issuing annual notices by the third-party provider engaged by the insurer.

Life CCC chair Jan McClelland said failure to facilitate annual notices in a timely manner can cause significant consequences for customers.

"Customers rely on these notices to understand what their policy covers, what they are paying and whether anything has changed," McClelland said.

"When that information is wrong, incomplete or arrives late, customers can be left uncertain about the insurance protections they are relying on."

As a result, the Life CCC determined a formal warning and ongoing assurance requirement were "appropriate and proportionate". The insurer has also updated its annual notices, corrected policy information and issued communications and corrected notices to affected customers.

McClelland said the sanction reflected the scale and duration of the breaches.

"A formal warning puts the insurer on notice that these failures were serious and that stronger enforcement action may follow if further non-compliance occurs," McClelland said.

"It is not enough to correct individual notices after problems have affected thousands of customers. The insurer must show that it has addressed the underlying weaknesses and can meet its commitments in practice."

The insurer must also provide evidence of the corrective actions taken to strengthen its control, oversight and assurance arrangements, and the Life CCC will assess whether those actions are effective and capable of preventing recurrence.

The Life CCC expects insurers to maintain effective controls over annual communications, apply appropriate assurance during system changes and actively monitor third-party providers.

Insurers should also use proactive monitoring to identify emerging issues before they become widespread or are revealed through a customer complaint, it said.