Melbourne Law School - Research Publications
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Item'Fledgling Financial Needs', Affordability and Attitudes as Drivers of Noninsurance Among Young Australians(WILEY, 2024-01-01)Building, home contents and comprehensive car insurance promise protection against loss or damage from fire, flooding, accident and theft. In Australia, young people aged 18–24 are among the groups most likely to forego these insurance products. Yet research on the reasons for this remains limited, as noninsurance among young people is attributed to their dependent or ‘fledgling’ life stage, with minimal income and assets warranting protection. In this article, we argue that noninsurance may have serious consequences for young people, particularly if they have limited savings and cannot count on financial assistance from their families. Drawing upon survey findings, we undertake an in‐depth investigation into the role of asset levels, affordability and attitudes in driving young people to forego insurance. Our findings suggest that young people are not especially predisposed to distrust insurers, to consider insurance inessential or to oppose insurance on principle. However, other attitudes—including lesser risk aversion, higher confidence in their capacity to mitigate risks and perceptions of insurance as irrelevant to their circumstances or ‘not for them’—may be more prevalent in this age group, driving them to remain uninsured even when they have assets warranting protection and sufficient income to offset affordability concerns.
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ItemNo Preview AvailableThe arduous work of making claims in the wake of disaster: Perspectives from policyholders(WILEY, 2022-11-01)With its promise of protection and peace of mind, insurance ownership is a key component of Australia’s national strategy to manage and spread costs of disaster recovery. We argue that an arduous and confusing claims process can have profound impacts on policyholders’ capacities to live safely in their homes as well as on their physical and mental health, finances, and levels of trust in insurers. Yet there has been little empirical research on policyholders’ experiences of putting this promise to the test by claiming on policies in the wake of disaster. In this article, we analyse interviews with policyholders who faced problems when making a building or home contents insurance claim following bushfire, flood, or storm. Evidence shows that aspects of claims processes place significant demands on policyholders’ financial and emotional resources, often in the aftermath of deeply traumatic and destabilising events. Our findings raise questions about the extent to which insurers’ claims handling processes and outcomes are consistent with requirements that call on insurers to respond efficiently, professionally, practically, and compassionately when and after disaster strikes.
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Item'Honest, Fair, Transparent and Timely’? Experiences of Australians who make Claims on their Building, Home Contents or Comprehensive Car Insurance Policies(Monash University, 2021)In Australia, building, home contents and comprehensive car insurance are regarded as ‘essential’ financial products. Yet the limited research on the experiences of consumers who claim against these policies highlights problems with claims handling by insurers, who are required under the General Insurance Code of Practice (2014) to decide claims in an ‘honest, fair, transparent and timely manner’. These problems are especially apparent in the aftermath of natural disasters, and include inappropriate investigation practices and delays that exacerbate financial hardship for policyholders. In this article, we analyse the findings of our survey of policyholders who recently made claims on building, home contents or comprehensive car insurance policies. We show that while most claims are accepted, excessive resolution times, poor communication and problematic investigation practices by insurers make the claims process burdensome and overwhelming for a significant minority of policyholders. Our findings indicate substantial levels of exposure to financial loss for policyholders who accept cash settlements and problems with transparency surrounding withdrawn or cancelled claims. Our findings highlight issues with compliance with the legal frameworks governing insurance claims, as well as gaps in consumer protection that should be addressed in expectation of more frequent extreme weather events in the coming decades.