ASIC hits super funds on death claims handling
Superannuation funds have been hit with a list of 34 recommendations from the Australian Securities and Investments Commission in a report which has found serious shortcomings with respect to death benefits claims handling.
Releasing the report today, ASIC said the report had revealed “devastating impacts” from poor industry practices.
ASIC chair, Joe Longo said the report has identified a range of issues, including excessive delays, poor customer service, and ineffective claims handling procedures, and called on industry leaders to take ownership of the problems and flex their muscle to fix the failings.
“This is an important report that looked at 10 trustees, representing a total of 38% of all member benefits in superannuation funds regulated by the Australian Prudential Regulation Authority. While some trustees performed better than others, tellingly none of the reviewed trustees monitored or reported on their end-to-end claims handling times or performance,” he said.
‘At the heart of this issue is leadership that doesn’t have a grip on the fund’s data, systems and processes – and ultimately it is the customers who suffer for it,” Longo said.
ASIC Commissioner, Simone Constant said the regulator is calling on the superannuation industry to immediately review and address death benefits claims handling.
The ASIC review found of the 10 trustees found:
- many examples of excessive delays and poor service
- gaps in trustee data and reporting
- some trustees’ processes and procedures were unclear and inconsistent
- communication and engagement were often ineffective and insensitive, and
- inadequate support for First Nations claimants and claimants experiencing vulnerability.
ASIC reviewed:
- Australian Retirement Trust
- Avanteos (Colonial First State)
- Brighter Super
- Commonwealth Superannuation Corporation
- HESTA
- Hostplus
- NM Super (AMP)
- Nulis (MLC)
- Rest
- UniSuper
Dear ASIC, as you say
‘At the heart of this issue is leadership that doesn’t have a grip on the fund’s data, systems and processes – and ultimately it is the customers who suffer for it,” Longo said.
So how many Super Fund trustees have been Fined, Banned or Publicly shamed?
How is it that Financial Advisers with much less problems are killed.
Industry Super Fund trustees continue to down their Member paid for food & drinks in the MCG box whilst they negotiate with ASIC minimal fines, for their Members to pay.
Cbus & AustralianSuper with massive Insurance & Death benefit claim issues don’t even make the ASIC review list.
Corrupt Useless ASIC at its worst again
Yeah, when an adviser stuffs up there seems to be a hammer waiting to smash them.
When a Trustee stuffs up, there’s crickets.
Where are all the academics with their $0.02 on the ethics of all this?
You know what would be a really good idea? Let the same people who can’t handle the death claim process to give advice without the proper qualifications and consumer protections. What could go wrong?
Great article Mike, don’t see much reporting on something like this! goes to the heart of the issue that many advisers speak about.