Brian Burston (NSW, Pauline Hanson's One Nation Party) Share this | Hansard source

I acknowledge Australia's historic nation, forged by Christian explorers and pioneers from Britain and other European lands which created the federal Commonwealth under the Crown, and I acknowledge Australia's first inhabitants, the Aboriginal and Torres Strait Islander peoples, part of our nation.

Insurance is not what it claims to be. According to a KPMG report in 2016, the insurance industry's profits rose 18 per cent in that year, recovering from a low point in 2015. Why? A lower frequency of natural catastrophes, combined with a continued focus on cost savings, resulted in overall profits rising to $4.058 billion, compared with the previous 12 months drastic fall of $3.452 billion. It makes you wonder how they can afford to eat, doesn't it?

I have a constituent named Luke Quintano who was involved in a motor vehicle accident on 27 October 1999. The insurer was Allianz. Just when the claim was about to be settled, Allianz advised that they had used the wrong formula, and the entire process would have to be started again. On 15 December 2002, while waiting for Allianz to get their act together, Luke went out and was shot in the head at a nightclub. He lost an eye and the use of the left side of his body. It turns out that the nightclub's insurer was a foreign company illegally selling insurance via a broker network. What was Allianz's response on hearing of the second incident? I am paraphrasing, but it goes something like this: 'We can pay you less for economic loss because now you're disabled and you would not make as much income over your lifetime as you would have if the shooting had not happened.'

Luke's father approached both Liberal and Labor ministers over the years and was given the bum's rush. I guess it was all too hard. The claim was finally settled on 27 February 2004. That was only the claim for the motor vehicle accident. The shooting incident will have no settlement.

So who does the little guy come to when they've been denied help by the mainstream political parties? Yes, One Nation. I approached the Insurance Council of Australia and was told by them that all that could be done was done. They claimed that Allianz had made an offer of settlement to Luke, but he didn't respond. Then they made a second offer of settlement, and Luke didn't respond. According to Luke's dad, no offer was ever made. I know who I believe, and it's not the Insurance Council of Australia.

Who are the Insurance Council of Australia? Well, according to their website:

The Insurance Council of Australia (ICA) is the representative body of the general insurance industry in Australia. Its members represent more than 90 per cent of total premium income written by private sector general insurers. Insurance Council members, both insurers and reinsurers, are a significant part of the Australian financial services system.

In a submission to the Senate Economics References Committee of inquiry into Australia's general insurance industry earlier this year, the Insurance Council of Australia made 31 references to claims, but not one—not one—was about the claims process, the transparency of the claims process or the manner in which they dealt with customers during the claims process. They only spoke of how much claims cost them and not much else. I guess the term 'customer focus' hasn't made its way into the insurance industry just yet.

In the KPMG report I mentioned earlier, the word 'claim' is only mentioned once as a topic of how much money was made because of fewer claims. Remember, Allianz is one of the companies that collectively in 2016 made over $4 billion profit. They seem to be all about profit and less about paying out claims or managing the customer relationship. Perhaps they could invest some of the $4 billion looking after victims of dodgy insurers selling policies in Australia that cannot be claimed against.

The Insurance Council of Australia takes no responsibility for the foreign companies' actions. Similarly, the broker who sold the policy to the nightclub takes no responsibility for the foreign companies' actions, nor for their own actions when they were notified that the insurance provider was not registered to operate in Australia. They should, at least, have sold a policy from a registered insurer to a nightclub or accepted the liability for Luke's claim. Aren't the brokers insured? If not, why not? Failing that, the Insurance Council of Australia should have accepted responsibility, as the industry peak body, sorted out the problem with the consumer and dealt with the member companies later. If there are brokers selling products that are not legal or compliant, the Insurance Council should take it out of the broker's hide after they've settled the claim with the consumer.

I think that after we're finished with the banks we might have a go at the insurance industry, including the Commonwealth Superannuation Corporation for the manner in which they treat veterans. Perhaps we should include the insurance industry in the terms of reference for any banking industry royal commission. By that, I mean insurance companies, brokers and anyone remotely engaged in the sales or claims process. If they cannot police themselves we will have to police them, for the benefit and protection of customers.

The insurance industry in this country is long overdue for a shake-up and we are just the people to make sure it happens. I suggest that the Insurance Council of Australia and its member companies lift their game and make contact with Luke Quintano's father to resolve what is obviously an unresolved matter. It doesn't matter what has gone on before. The problem needs to be fixed and fixed now. This young man has suffered enough and for too long. If he were your son, what would you want to happen? The royal commission into banking is not that far away.