Law firm, super funds circle in wake of CommInsure scandal

A Four Corners and Fairfax Media investigation aired allegations by former CommInsure chief medical officer Dr Benjamin Koh, as well as four case studies of policyholders who claim they have been poorly treated by the insurer, with CBA chief Ian Narev subsequently apologising for the incidents. 

Following these reports, South Australia-based law firm Tindall Gask Bentley (TGB) said it is acting for CommInsure claimants and investigating individual claims on behalf of clients.

"The revelations exposed in the media are deeply concerning and add to the trauma that many claimants and their families are already going through," TGB partner Barney Gask said.

"Many have had entitlements held back, often while suffering debilitating or terminal conditions, and we are calling for swift action by the insurer to address these concerns."

TGB added it is also urging Australians who have had claims rejected by CommInsure – particularly a TPD, trauma or life policy – and by "other insurers" to seek legal advice.

ifa's sister publication InvestorDaily sought comment from the 10 industry funds that currently use CommInsure for their group insurance arrangements.

Care Super chief executive Julie Lander said her fund is "very concerned" about the allegations, and currently "in dialogue" with CommInsure over the matter.

"We're very conscious about the businesses that we partner with, and that they demonstrate the right values that are aligned with ours," Ms Lander said.

While not prompted by this week's revelations about CommInsure, Care Super is currently undertaking a three-year review of its insurance arrangements.

QIEC Super chair Terry Burke told InvestorDaily his fund immediately raised the risk level around its insurance arrangements on Tuesday.

"We put CommInsure on notice that we would be seeking appropriate clarification and explanation," Mr Burke said.

NGS Super executive manager of customer Dascia Bennett told InvestorDaily she was in touch with CommInsure at 10am on Saturday morning when she heard the first media report.

"[CommInsure] are in the midst of providing NGS with a full review and update on whether we have any members that are impacted in regard to these media issues and complaints," Ms Bennett said.

"At this stage we do not have any NGS members who have come to our attention who are involved in this," she said.

However, Ms Bennett conceded it is a "massive concern" to any fund or business partner "where you see behaviour that doesn't meet the ethical standards and the philosophy of putting the member first".

Kinetic Super has released a statement indicating it is taking a "proactive approach" to the Four Corners allegations.

"We are reviewing all disputed claims made in the last two years to ensure that outcomes were fair and appropriate," said Kinetic Super.

A HESTA statement indicated the industry fund has "raised our concerns at the highest levels of CommInsure and are conducting a detailed assessment of the issues".

"HESTA reviews the performance of our insurer and other service providers on an ongoing basis. We will continue to monitor how CommInsure are addressing these issues," said HESTA.

Vision Super said all of its members' TPD insurance claims denied by CommInsure were reviewed by the fund's Benefits Committee.

"Our Benefits Committee has exercised its right to arrange independent medical advice, and a number of claims rejected by the insurer have subsequently been overturned for members," said Vision Super.

Prime Super chief executive Lachlan Baird told InvestorDaily his fund is "very concerned" about the allegations.
CommInsure won a tender to provide group insurance to Prime Super members in January, with the arrangement set to begin on 1 May 2016.

Club Super said in a statement it is "clearly minding these revelations and as a result will be reviewing the risks associated with CommInsure at the upcoming board meeting".

"[Club Super] expects all its service providers to uphold high levels of governance and ethical standards. Anything which falls short of this expectation will be reviewed and remedied accordingly," said the statement.

AustSafe did not respond by InvestorDaily's deadline.

Meanwhile, the Australian Lawyers Alliance has written to Assistant Treasurer Kelly O'Dwyer and shadow financial services and superannuation minister Jim Chalmers urging that a royal commission into the insurance sector be established to get justice for clients unfairly treated by CommInsure.

"We are calling for an inquiry with the powers of a royal commission to call witnesses, take evidence and particularly to pursue and procure key documents to uncover such poor behaviour," Australian Lawyers Alliance national president Greg Phelps said.

"Unfortunately, we also see too many instances where insurers use definition changes, avoidance clauses and delays and disputation as a means of avoiding their responsibilities.

"There is an urgent need to review the law around insurance policies, to ensure claimants are treated fairly when they need it most – when they are faced with terminal or chronic illness," he said.

The lobby group has also called on the MPs for a "three-part reform" in the sector, particularly for TPD claims.

These reforms would be based on identifying bad behaviour and calling it out; confirming the minimum standards that insurance policies should meet; and ensuring higher standards of behaviour in the sector.