Insurers are hardly Australia’s most loved businesses. Facing a prolonged cost-of-living crunch and record premium hikes, many are opting to ditch their policies. Moreover, the legitimacy of denied claims is increasingly being called into question, with a recent report finding that nearly half of these denials were overturned when individuals complained about the decision.

The insurance industry no doubt is facing mounting pressure to improve its resolution processes and rebuild consumer trust.

The Australian Financial Complaints Authority (AFCA) serves as a vital partner in this process: not only as a last resort for customers seeking rightful recompense but also an invaluable resource for industry in understanding and rectifying consumer pain points. 

In the lead-up to our Future of Insurance conference in March, we spoke with featured event keynote Emma Curtis, AFCA’s Lead Ombudsman for Insurance on the evolution of the complaints mediator since its formation in 2018.

As complaint numbers surge, Curtis offers unique insight into how financial services businesses can drive long-term service and process improvements. With a focus on preventing issues before they escalate to AFCA, Curtis outlines the steps needed to work towards its ambitious goal of a future with zero complaints. 

FST Media: The Australian Financial Complaints Authority (AFCA) has emerged in a period where financial services have become increasingly embedded in consumers’ everyday lives, with the advance of mobile technologies, but also where industry has been increasingly questioned and called to account (notably in the wake of the Royal Commission).

Take us through the evolution of the AFCA since its founding in 2018. Based on complaints that you’ve received, how would you rate the current state of the financial services industry? 

Curtis: Since November 2018, AFCA has evolved into a globally recognised dispute resolution service. We’ve brought together the functions of several predecessor schemes, providing a single efficient place for complainants and financial firms to resolve their disputes. 

In just six years, we’ve received more than 515,000 complaints, and we’ve helped secure over $1.3 billion in compensation or refunds for consumers.

 

Our journey reflects the rapidly evolving external environment that consumers and businesses are facing with incredible advances in technology behind quite a lot of these trends.  A recent success has been the transformation of our Systemic Issues function, as part of our landmark response to Treasury’s 2021 Independent Review. This transformation has seen us work with industry to resolve more than 210 systemic issues, with supporting insights made available to our stakeholders through new and dynamic channels.  

FST Media: You noted the more than half a million complaints received by AFCA since its founding – no doubt a huge repository of insight. How valuable is this data in understanding the current financial state of customers? 

Curtis: We’re a real indicator of the financial situation of many consumers. AFCA received a record number of complaints in 2024, and we can see that complaint volumes are increasing year on year, which really calls out the need for industry to proactively address systemic issues that are affecting their consumers. Particularly for insurance companies, it’s a real call-out to delve deep into the root causes of the complaints that they’re getting and leverage their data and analytics to identify patterns and implement proactive measures before they become a complaint.  

Overall, complaint data is a really rich source of information that firms can analyse to identify problems, assess how effective their own internal dispute resolution process is, and look to refine their customer service strategies to stop complaints from arising in the first place. For instance, again in my area of insurance, we get a lot of complaints about claims handling delays, which indicates, obviously, that claims processing systems are ripe for review and there are opportunities to improve them. Communication protocols are also key.  

There are opportunities here for insurers to look broadly at other sectors and how they’re managing similar issues and leveraging technology and innovation to develop effective communication strategies where there’s a pressure point like claims handling timeframes. Generally, continuous improvement with robust data analysis can help reduce complaint volumes and bolster consumer confidence in the financial sector. 

FST Media: It often seems that organisations focus on immediately satisfying customers rather than addressing the systemic problems that could prevent future issues and complaints. 

How can financial services organisations make better use of complaints data to bring about positive, long-term change?

Curtis: There’s a real opportunity to learn from the past by introducing new systems and processes to address current problems. By looking broadly across the financial services industry and seeing what other sectors are dealing with – for instance, scams are likely to become an issue more broadly across other product areas outside of banking – they can pre-empt these issues. The data is available for anyone to look at and can act as an early warning system, both for a particular firm or the financial sector more broadly, to identify potential future issues.  

Introducing innovations such as real-time updates on claims progress, for instance, can really help reduce consumer dissatisfaction about wait times and complaints.

It might also help to speed up the claims process by making some things less manual. User-friendly digital platforms for lodging and tracking complaints could help streamline the resolution process and make it more transparent and efficient.

Introducing more automation around routine tasks can help free up human resources to focus on more complex issues which need a personal touch. Some of those innovations can really help increase operational efficiency and demonstrate a proactive, customer-centric approach, which should help increase customer satisfaction and reduce complaints. 

FST Media: Complaints often reach AFCA after months of unresolved negotiation between customers and financial institutions. What critical areas should organisations focus on to prevent complaints from escalating to AFCA, and how can they improve their processes to resolve issues earlier? 

Curtis: It’s about identifying consumer frictions and mistrust, because customers should be going to the firm first to resolve a complaint.

If they come straight to AFCA, it might indicate either that there’s a lack of trust from the consumer and they just want to go straight to an external body to get it resolved or that the complaints aren’t being properly captured by the firm and registered.  

There are a number of opportunities to look at this and ask, ‘Why are customers going straight to AFCA and what is the cause of these underlying complaints? Is there a simple fix to some of them, or is there a longer-term solution that needs to be implemented to help address it?’.

FST Media: Given the myriad reasons customers file complaints, AFCA has a unique perspective on macro trends in customer experience within the insurance industry.

Are there any emerging trends or potential issues that insurers should be better aware of? 

Curtis: Climate risk is an interesting and concerning one. Australia has experienced frequent natural disaster events in recent times, with some having had significant impact on communities and individuals, as well as on the claims handling processes that respond to them.

While these events aren’t always preventable in the short term, there is still a lot that can be done to prepare for the future. We know there will be more challenges to come, so what can we learn from each other and the past? How can we prepare better for the next to help alleviate that pressure on consumers and communities, and get those claims resolved quicker? 

FST Media: Research from regulators shows that technology, particularly AI, can both assist with and generate complaints. Can you elaborate on how AI might contribute to the complaints process? Is there a concern that these systems may fail to account for the emotional or human value of certain properties? 

Curtis: I acknowledge there are risks in using AI and we wouldn’t want to see a whole-scale movement to that. It’s worth examining and exploring how it can be used to streamline processes and make them more efficient, but the human element is always going to be important; we’re keen to see that firms have good, robust processes for identifying vulnerabilities and tools that they can equip their people with to deal with those issues, so people aren’t put into more difficult situations as a result of a claims process that doesn’t look at them as an individual.

With enhanced use of AI, it will be important for firms to ensure they have policies in place to consider consumer fairness and bias. The corporate regulator ASIC has recently reviewed the use of AI by financial firms and urged them to do work quickly to ensure governance is adequate for a surge in consumer-facing AI. I would be particularly concerned about unintended discrimination or bias in claims handling and claims decisions. 

FST Media: How do you see technology more broadly improving the dispute experience, particularly before it reaches AFCA? What can organisations do with data, technology, and tools to enhance their internal processes and systems? 

Curtis: I think a ‘test and learn’ approach is really important. And, like I said, looking broadly across other industries to see what they’re doing and how they’re harnessing technology, getting direct consumer feedback about what works and what doesn’t work so well, and learning from it, is hugely beneficial. It’s about making sure that there are no adverse or inadvertent consequences from using a particular technological solution, but also about focusing on that communication piece. That’s really important.  

Obviously, there are many things that can be done to speed up response times, like reviewing supply chains to speed up repairing motor vehicles or repairing houses that have been damaged. But if there are intractable supply chain issues that are slowing down processes, then communication with the customer remains so important. For that to be both automated and personalised will be really helpful going forward. But, again, it’s about testing and learning different approaches and seeing what works best. 

FST Media: TheWorld Life Insurance Report 2025 showed a noticable decline in customer trust and satisfaction with insurers in recent years. What key success factors do you see in organisations that handle disputes well, and what areas do you think need more focus? 

Curtis: In the current environment, we’re hearing about significant premium increases, which is putting pressure on household budgets. We’ve seen a number of recent natural disasters with significant losses, with people experiencing delays and frictions in the claims process, which puts pressure and stress on those households.  

An insurer that can give a positive experience to a customer at claim time is going to be really successful in rebuilding trust and confidence that they’ve paid for a valuable product.

In relation to premiums, it’s really critical to be transparent. Insurers should do more to explain, in as much detail as possible, why a policy’s premium has increased, to ensure the customer understand the reasons behind it and what factors the insurer has taken into account. This gives customers the assurance that the premium has been properly applied and helps them identify if there’s anything that they can do to reduce it. 

FST Media: What advice would you give to an insurer seeking to improve but unsure where to start? 

Curtis: Examine your data. Complaint data is so valuable, and it can be looked at in so many different ways to obtain insights about customer touchpoints, claim durations, and feedback outcomes. It’s really important to continuously review both internal data and external AFCA data and identify potential systemic issues that might need fixing for a whole cohort of consumers, not just one consumer. 

AFCA issues a comprehensive annual report providing lots of insights and data about the volumes and trends we’re seeing and the themes and complaints from a product perspective. We also have a publicly accessible Data Cube which breaks the information down by product and sector, providing detail about individual firms that are members of AFCA and what type of complaints they get. Taken together, you can get a very detailed picture of the complaint profile that we’re seeing across various sectors. 

FST Media: AFCA has a lofty but noble vision of zero complaints. Based on data and trends from customer complaints, what does the future look like for the industry and what steps can be or are being taken to achieve this vision? 

Curtis: It is a lofty goal, no doubt. We recognise that it’s aspirational. But it’s all about addressing the underlying harms and costs that sit behind the current volumes of complaints that we’re seeing. We imagine that firms would also like to have far fewer complaints, as it’s going to be better for them and their customers as well. That’s the principle that we’re working towards which guides AFCA’s continuous improvement initiatives and enables us to share our unique insights with financial firms and the industry to help reduce their complaints.

There are some core challenges facing the financial services sector that will need to be addressed if we’re going to achieve that vision. Some things I’ve already mentioned, like delays in claims handling, are specifically about insurance, but others can be broadly applied to other financial products, like identifying and supporting vulnerable consumers.  

Those are some of the key areas where firms can improve. This entails investing in staff training, customer service complaints, effective communication with customers, and in testing and learning what works. It’s about streamlining operational processes to reduce delays and implementing robust support systems for customers facing hardship and vulnerability. There’s a lot of alignment between our goals with business and customer outcomes, because we are prioritising the needs and rights of consumers, which is a win-win-win for AFCA, customers and business. 

FST Media: Achieving the vision will no doubt require collaboration between financial services organisations, regulators and independent bodies like AFCA. How can we ensure effective collaboration between these key stakeholders?

Curtis: AFCA has a unique position because we’re not, strictly speaking, a regulator. We’re independent. We sit between the consumer and the financial firm to resolve complaints in a very independent and fair way. We are different to regulators in that regard, and we see collaboration as key to resolving and reducing complaints in the future.

The more insights and learnings that we can provide to firms, and the more they can implement improvements to customer outcomes, the more we expect to see reduced complaints, which is going to be better for everyone. 

There’s always going to be a bit of a catch-up to developing regulations, but we aim to devise solutions that are flexible enough to adapt to emerging issues and problems. There seems to be a pretty rapid rate of change at the moment, but maybe it always feels like that when you’re in it. And with collaboration and testing solutions, seeing what works and what doesn’t and communicating effectively, I think we can work together on addressing these risks as they emerge. 

FST Media: We’re delighted to have you speaking at our upcoming Future of Insurance conference. What are you excited to learn from industry leaders and peers? 

Curtis: I’m really looking forward to this opportunity. It’s going to be a great chance to engage with industry leaders and innovators and learn first-hand about some of the innovations that are being implemented, trialled and tested.

We can learn a lot from advancements in technology that insurers are implementing, for instance around claims handling and helping customers experiencing vulnerability. We value that learning so much at AFCA. We can’t operate in isolation, so hearing about what the industry is doing will be important and exciting. ◼️