2011 ANZIIF TurksLegal Claims Scholarship
Winner
Dealing with claims on the basis of “spirit” rather than terms Julie Harriss | CGU Insurance
Should an insurer deal with claims on the basis of the “spirit” of the contract rather than the terms ? What benefits or disadvantages might there be to insurers ,claims professionals dealing with claims and insurance customers in taking one approach or another? It would seem too many in the insurance industry that it is the lot of an insurer to be misrepresented and misunderstood in the media. It has become common place for insurers to be fair game to journalists and current affair programs. But as our nation grappled with devastating natural disasters in the early part of 2011, it was the highest offices of government that launched a stinging attack on the industry. The comments made by Bill Shorten in the Insurance News in April/May reinforced a message to the public that insurers were both uncharitable and litigious. More recently, the Queensland State Government has questioned the time frames in which claims were settled and suggested that insurers need to be forced to pay claims that have not been dealt with in a reasonable period. Premier Bligh weighed into the debate by suggesting insurers would not breach the Code of Practice if breaches were disclosed in the media. One can only wonder where the evidence is obtained that supports the notion that insurers are keen litigants or they have forsaken their duty of good faith. Indeed, one can only assume that very little research has been undertaken and the true intent of such comments is to detract from potential backlash. As insurers faced billions of dollars of additional claims, falling share prices and stretched resources, the rhetoric that insurers generally lack compassion and avoid claim payments was highly damaging. It had a profound effect on those working in front line claims response teams and added to the level of stress for those who had suffered loss.
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