Insurers improving compliance but must address root causes
General Insurance Code Governance Committee
The latest report from the General Insurance Code Governance Committee (CGC) shows a decline in breaches of key Code obligations, suggesting signs of improvement in some aspects of insurers’ compliance frameworks.
However, persistent issues in identifying and addressing the root cause of breaches, and a surge in complaints, reflect a need for more substantial improvements.
Covering the period from 1 July 2023 to 30 June 2024, the CGC’s Annual Data Report reveals a promising trend: overall breaches are decreasing, while an increase in previously underreported breaches suggests insurers are strengthening monitoring and detection.
Chair of the CGC Ms Veronique Ingram was optimistic about the increase in reporting of breaches in areas the CGC felt were underreported in the past.
“This is an encouraging sign that insurers are becoming more proactive in identifying and addressing certain compliance gaps,” said CGC Chair Veronique Ingram. “Better oversight and more rigorous reporting indicate a shift towards stronger industry standards.”
Despite these gains, the report finds that insurers continue to report a high number of breaches caused by “processes and procedures not being followed” without adequately addressing the root causes.
“Simply flagging these breaches isn’t enough though,” Ms Ingram said. “Insurers must go further and look at what is causing the breaches so they can implement long-term, sustainable solutions.”
Ms Ingram called for improvements from insurers in identifying root causes.
“Insurers must examine their systems and workflows, explore technological improvements, and ensure staff are adequately trained to identify issues. It is crucial that insurers can prevent issues before they arise.”
The report also highlights an 18% increase in complaints, largely driven by disputes over motor insurance claims and premium increases. Many of these complaints were resolved in favour of customers, raising questions about whether better communication could have prevented them in the first place.
“Clear, transparent, and proactive communication is essential,” Ms Ingram said. “If insurers explain premium changes upfront and engage with customers effectively, they can reduce complaints and improve trust.”
The CGC’s findings suggest that while compliance is improving, insurers still have work to do – particularly when it comes to fixing underlying issues and communicating more effectively with customers.
Read the full CGC Annual Data Report.
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The General Insurance Code Governance Committee is an independent body that monitors and enforces insurers’ compliance with the Code of Practice.
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