Claims review highlights the cost of slow communication

The review, released on 30 October 2026 and reported this week, examined claims data from the 2023-24 financial year across six life insurers. It focused on cases where insurers had treated delays as affected by circumstances beyond their control, then tested whether insurer-managed parts of the process were still handled as well as they could have been.

The figures are significant because they point to practical gaps rather than simply complex claims. Insurers acknowledged that information should have been requested earlier in 42 of the 67 TPD claims reviewed and 45 of the 116 income protection claims reviewed. The committee also found that communication and review commitments applying to delayed claims were not always met consistently.

For people using partnership life insurance as part of a business continuity or buy-sell arrangement, the finding is a reminder that the claims process matters as much as the headline sum insured. A delayed TPD or income protection decision can affect cash flow, ownership negotiations, debt servicing and the practical ability of remaining partners to keep a business operating while a claim is assessed.

The inquiry does not mean every long claim is mishandled. TPD and income protection claims can involve medical evidence, occupational information, rehabilitation updates, superannuation trustees, employers and financial records. Some delays may be unavoidable. The concern raised by the committee is narrower but important: when an insurer controls part of the process, it should identify what is needed early, avoid piecemeal requests where possible and keep the claimant informed about what is happening.

Consumers and business owners can draw several general lessons from the review:

• keep policy documents, ownership details and beneficiary or buy-sell records accessible;
• make sure business partners know where key insurance and legal documents are stored;
• respond promptly to reasonable information requests and keep a record of what has been supplied;
• ask for clarification if the insurer’s next steps, timeframes or reasons for delay are unclear;
• review cover arrangements when business debts, ownership shares or key roles change.

The broader point is one of claim readiness. Insurance is often arranged years before it is needed, but claim outcomes can depend on practical administration at a difficult time. The committee says some insurers have already begun remediation, breach reporting and process improvements. The next test will be whether those changes translate into clearer, more consistent claims handling across the sector.