The Australian Financial Complaints Authority (AFCA) reported that delays in claim handling were the most prevalent issue, with 9,274 complaints filed. This trend highlights the critical need for insurers and financial institutions to streamline their processes and enhance customer service.
Superannuation-related complaints saw a significant rise of 29%, totaling 7,687 cases. The primary concerns in this category were delays in handling claims and disputes over claim decisions, indicating a pressing need for transparency and efficiency in superannuation fund operations.
Additionally, complaints about misleading products or service information more than doubled, increasing by 110%. This sharp rise points to the necessity for financial institutions to provide clear, accurate, and honest information to consumers to maintain trust and compliance with regulatory standards.
Personal transaction accounts were the most complained-about financial product, with 15,315 complaints, followed by motor vehicle insurance (12,879), credit cards (11,316), home building insurance (7,359), and consumer credit insurance (7,137). Notably, complaints regarding consumer credit insurance saw an 88% increase, reflecting heightened consumer awareness and scrutiny of financial products.
Since its inception in late 2018, AFCA has received over 634,000 complaints and secured $2.1 billion in compensation for consumers. These figures highlight the essential role of the watchdog in addressing consumer grievances and promoting accountability within the financial sector.
The rise in complaints serves as a call to action for financial institutions to reassess their customer service protocols, ensure compliance with industry standards, and prioritize consumer satisfaction. By addressing these issues proactively, the industry can work towards rebuilding trust and delivering better outcomes for all Australians.
