RACQ facing a surge in customer complaints over rising premiums

ABC NEWS (Australia)

Rising premiums and grievances about how insurance claims are being handled are driving a surge in complaints against RACQ, one of Queensland's biggest insurers. Customers say quotes for home cover have doubled, or even tripled, and they can't get clear reasons why.

Transcript

00:00It's an insurer that's weathered decades of storms and floods, but it's confronting new

00:06trouble of its own making. Gold Coast homeowner John Monks says his canal

00:10side property has never flooded, but the insurer more than doubled his premium last year.

00:15Horrendous, it was 110% increase. He negotiated it down, but plans to take his

00:20business elsewhere. He's one of more than 35,000 Queenslanders making complaints about

00:25the insurer in the year to June. Complaints to RSQ have almost doubled since

00:302022. It was also slow to respond to more than 20% of complaints to the ombudsman.

00:36If you're not meeting deadlines with the ombudsman, you've got problems with your processes and

00:40procedures. That is like kindergarten stuff that needs to be addressed.

00:44The pressure's been building for some time. The Federal Financial Regulator criticised

00:48RSQ's risk processes in 2022, pointing to an immature risk culture.

00:54Chief Executive David Carter insists the company is addressing the issues.

00:58We changed our processes, added in resources, and we've seen some material improvement in

01:03that. The whole industry is lifting premiums amid

01:06floods, storms and inflationary pressures, but RSQ has also introduced new risk modelling,

01:12and that's putting an extra spike on some home prices.

01:15RSQ says most households' premiums were largely unchanged, but 12% of properties it insured

01:21were considered high risk for floods and storms, triggering higher insurance prices.

01:25We are spreading out the increase over several years for some of the extreme risks.

01:30Summer will be a test of the insurer's new risk profile, and how many customers are willing

01:35to weather its premium increases.

Category

Transcript

Be the first to comment

Recommended