Australia’s General Insurance Industry Updates Code of Practice for Enhanced Consumer Protections
Australia’s general insurance industry has entered a new phase in updating the General Insurance Code of Practice, with the goal of creating a version that is both legally enforceable and more accessible to policyholders by 2027. The Insurance Council of Australia (ICA) is spearheading this revision, which will incorporate findings from a recent independent review and recommendations from the 2022 Parliamentary Flood Inquiry.
The current code, first introduced in 1993, has been criticized for being difficult for consumers to interpret and inadequately aligned with modern insurance challenges, including regulatory changes and disaster response protocols. Insurers and the ICA have agreed that the revised document must clarify insurer obligations and make them easier for customers to understand.
The ICA has confirmed that the new version will be developed with extensive input from consumer stakeholders, regulators, and government bodies. Andrew Hall, ICA chief executive, emphasized that developing a new code is a “once-in-a-generation opportunity to deliver better outcomes for consumers.” He added that the industry is committed to maintaining and enhancing consumer protections, making it easier for them to understand their rights and engage with their insurer.
Key Developments and Timelines
The public consultation phase for the revised code is scheduled for early 2026, with the code expected to be submitted to the Australian Securities and Investments Commission (ASIC) later that year. The current version will remain in effect during the transition period.
Several complementary actions are already underway, including:
- An industry-wide standard for using expert reports in claims decisions
- A charter for how insurers respond to extreme weather events
- A new framework to support customers facing financial or personal vulnerability
- A forthcoming Australian Competition and Consumer Commission (ACCC) application seeking approval to standardize terms on property maintenance and deterioration
The ICA has also announced that insurers have agreed in principle to introduce internal consumer advocacy roles, with each company determining how best to structure these functions based on their operational models.
Stakeholder Perspectives
Consumer groups have welcomed the move toward enforceability but have stressed that stronger commitments must not come at the cost of existing protections. Organisations such as the Financial Rights Legal Centre, Consumer Action Law Centre, and Financial Counselling Australia have cautioned that any reduction in current standards would be unacceptable.
Drew MacRae from the Financial Rights Legal Centre emphasized the importance of ensuring that the code is incorporated into customer contracts without compromising existing commitments. Louise Hayes from Financial Counselling Australia highlighted the need for improvement in how insurers deal with vulnerable customers, particularly during crises.
Regulatory and Implementation Outlook
The ICA is expected to file an application with the ACCC by the second half of 2025 to advance standardized home insurance policy terms. Broader engagement will continue throughout 2025 and into 2026. The final version of the code, expected to take effect by 2027, aims to set a new standard for transparency and accountability in general insurance practices.
Until then, the existing code and supplementary reforms will guide insurer conduct. The industry is working towards creating a more consumer-friendly and robust regulatory framework for general insurance practices in Australia.
