Note: “Ben” is a pseudonym used to protect the privacy of the customer, the administrator, and their staff. This story is shared with the customer’s permission to highlight the challenges encountered and the support provided.
The Importance of First Impressions in the Claims Process
The initial interaction when lodging an insurance claim is crucial, as it sets the tone for the entire process. Often, customers undergo a significant struggle to recognise their need for assistance and the necessity of submitting a claim. They approach this step with trepidation, fearing that the insurer will go to great lengths to decline their claim and that the journey will be lengthy and complex. When their first contact with a superannuation fund’s administrator is met with inadequate service, it not only reinforces these fears but also cultivates a combative mindset even before their claim reaches the insurer or claims assessor.
Ben’s Experience
In February 2024, Ben contacted his Superannuation fund to verify his insurance coverage. What followed was a frustrating ordeal. The Fund’s administrator initially assured Ben that he had coverage and would soon receive the necessary paperwork. Despite receiving an email promising a response within five days, by June, he was still waiting!
Seeking Legal Assistance
Frustrated by the lack of communication, Ben sought help from a lawyer. The lawyer contacted the Fund and was informed that Ben didn’t have insurance coverage due to not meeting the “Putting Members’ Interests First” eligibility criteria. Despite this critical information, the lawyer failed to relay it to Ben or question why he had been told in February that he was covered, only to be told 5 months later that this wasn’t the case. Lacking practical claims experience and a deeper understanding of policy administration, the lawyer accepted this explanation at face value. With no coverage—and no fee to be earned—they simply moved on to the next case, leaving Ben in the dark.
Simplify My Claim Steps In
By the time Ben was introduced to Simplify My Claim, he was emotionally and mentally exhausted, he hadn’t received the claim forms, nor had his lawyer communicated about the progress of his claim or the important fact that he didn’t have cover. Our team stepped in to assist, and what should have been a straightforward process became a soul-destroying journey. From the very beginning, the experience was marred by inefficiency, lack of accountability, and a complete absence of empathy.
We made countless calls to the Fund, enduring on average over 40 minutes on each call, only to receive vague responses or be transferred from one department to another. Even the simplest tasks were subjected to 7–10-day service standards, and with each transfer, we faced the same frustrating delays. At one point, a Consultant told us that the team were three weeks behind in their workload!! This revelation was shocking, highlighting how the administrator’s backlog meant that individuals already struggling and needing to submit a claim were caught in a process churn where customer service was severely lacking. Rather than calling for clarification, they would send an email (from a non-responsive, unmonitored address), requesting additional information. This would push the claim back to the bottom of the queue, restarting the same long service delays. It became evident that to clear their desks, the administrator was doing only the bare minimum, neglecting the genuine needs of those they were meant to assist. We couldn’t help but feel sympathy for the other members navigating this ordeal without the support of an advocate.
Delays, Deflections, and a Lack of Accountability
Throughout these exhausting interactions, we were finally informed that Ben didn’t have insurance coverage. When we sought clarification, it only triggered further delays and additional follow-ups. Our attempts to escalate the issue with the administrator were met with indifference, as the managers of service consultants refused to take our calls. Rather than addressing our queries, the claims team opted to pass the case to their Resolutions Team, compounding our frustrations. Even one of the Resolution Team consultants expressed his own frustration at receiving the case, recognising it was an issue the claims team should have handled. The complete lack of accountability was utterly appalling. Despite Ben’s vulnerability there was no urgency or empathy shown by the Fund.
After our initial contact with the Fund, we waited 22 days for a written response. When it finally arrived, the tone was dismissive. In answer to why Ben had been told in February that he had cover, the Fund’s reply was simply, ‘This was an administrative error. The member did not have cover on the date of the event.’ There was no apology, no empathy, no acknowledgment of the distress caused by this error.
A further 30 days later, we received a formal response from the Resolutions Team, acknowledging their service failings but offering only reactive training as a resolution. How does that help Ben? For 5 months, he believed he had insurance coverage that would provide financial security for his family, only to find out he had none.
The Need for Accountability and Training
This experience highlights the devastating impact that poor customer service can have, particularly for individuals navigating the claims process. Ben’s story underscores the critical need for competent and compassionate service during these times. Without it, customers endure not only the consequences of the claim’s outcome but also the emotional toll of the process itself. The lack of accountability has significant repercussions for customers like Ben, who are faced with overwhelming delays and a profound absence of compassion when they need it most. If he indeed didn’t have insurance coverage, why wasn’t this initial error addressed with Ben from the outset? The consultant had made a mistake by informing him he had coverage. Someone should have taken ownership and reached out to Ben to correct this misinformation instead of allowing him to believe he had the financial security to submit a claim. In the complaint response, we were informed that Ben’s case had initially been sent to the wrong department, and when it was finally forwarded to the correct one, no one took any action to address it.
As an aside, this issue remains under investigation and will be included in our formal complaint to AFCA, alongside the service concerns. The rationale for why the cover was not triggered has yet to be supported by any evidence showing where or how this information is communicated to members.
Having worked closely with this Fund in one of my previous roles with an insurer, this was my first experience on the other side, assisting someone through their claim process. It was, as I mentioned, soul-destroying to manage this case and disheartening to witness firsthand the lack of empathy and service extended by their administrator to their members. I was only able to gain traction by leveraging a personal contact within the Fund. Without this connection, I fear we would still be shuffled from department to department, with no resolution in sight.
Superannuation Funds, like insurers, are obligated to handle claims efficiently, honestly, and fairly. According to the Fund’s Insurance Strategy Document, their claim’s philosophy is to handle claims with empathy, professionalism, and timeliness, ensuring that the claims process is as quick and caring as possible. Ben’s experience fell far short of this.
While the Life Insurance Code of Practice outlines insurers’ obligations—including treating customers with empathy (section 5.1) and ensuring staff are appropriately trained (section 5.45)—these requirements do not extend to external administrators. Although the Fund has established claims handling principles, the strategy lacks details on how these principles are effectively implemented. There is no equivalent obligation, as seen in the Life Insurance Code of Practice, to commit to comprehensive staff training or to ensure that employees do not engage with customers until they have demonstrated the necessary technical competency. Providing reactive training based on individual complaints falls far short of what customers should expect when navigating the overwhelming and daunting process of enquiring about lodging a claim on their insurance policy.
The Importance of Client Advocacy
This case highlights the critical role of client advocacy in shielding customers from the harmful effects of poor service. Just obtaining the basic information needed to start the claim was emotionally draining as an advocate. The excessive wait times, lack of accountability, frustrating discussions about delays, and complete absence of empathy made the process even more challenging. While I was able to protect Ben from these hurdles, many others facing this alone would likely find it overwhelming and give up. Sadly, the widespread lack of accountability and empathy we encountered across multiple departments shows this isn’t an isolated issue with this administrator—it’s a systemic problem.