How to Lodge an AFCA Complaint Against Your Insurer

The Australian Financial Complaints Authority (AFCA) is the national external dispute resolution (EDR) scheme for financial services in Australia, including general insurance. It replaced the Financial Ombudsman Service, the Credit and Investments Ombudsman, and the Superannuation Complaints Tribunal in 2018.

AFCA is free for complainants. There is no cost to lodge a complaint, regardless of the amount in dispute or the outcome. Insurers pay a fee to belong to and use AFCA — consumers do not.

AFCA can deal with disputes between consumers and their insurers about:

• Claim denials — your insurer refused your claim in full or in part
• Claim delays — your insurer has taken an unreasonable time to assess, decide on, or pay your claim
• Scope disputes — you disagree with the scope of repairs or the amount the insurer is prepared to pay
• Policy interpretation — a dispute about what your policy covers or how an exclusion applies
• Policy cancellation — your insurer cancelled or voided your policy and you dispute their right to do so
• Premium and fee disputes — including disputes about the basis on which a premium was calculated

AFCA can consider complaints from individuals (including sole traders) and small businesses with a turnover under $5 million and fewer than 100 full-time equivalent employees. For property damage claims, the maximum award AFCA can make is $1,085,000 for individuals (as at the current financial year). This limit is reviewed periodically.

Before you can lodge an AFCA complaint, you must first give your insurer a reasonable opportunity to resolve the dispute through their own Internal Dispute Resolution (IDR) process. This is a requirement under AFCA's rules, the General Insurance Code of Practice, and ASIC Regulatory Guide 271.

Under the General Insurance Code of Practice, insurers are required to:

• Have a free and accessible IDR process
• Acknowledge your IDR complaint within 15 business days
• Provide a final IDR response within 30 calendar days of receiving your complaint
• Inform you of your right to escalate to AFCA if you are not satisfied with the IDR response

To use IDR: contact your insurer in writing (email is acceptable) and clearly state that you are lodging a formal complaint. Reference your claim number, describe the dispute, and state the outcome you are seeking. Keep a copy of everything you send and receive.

You can proceed directly to AFCA without completing IDR in the following circumstances: the insurer has not responded within 30 days; the insurer has agreed to waive the IDR requirement; or the dispute involves a matter where IDR would cause you undue hardship (for example, financial hardship requiring urgent payment).

Once you have received an IDR response you are not satisfied with (or the 30-day IDR period has elapsed without a response), you can lodge a complaint with AFCA.

How to lodge: AFCA accepts complaints online at afca.org.au, by phone, or by post. The online form is the fastest method and allows you to attach supporting documents at lodgement.

Timeframe to lodge: You must lodge your AFCA complaint within two years of receiving your insurer's IDR response. Do not delay — evidence quality and witness recall deteriorate over time.

• Your contact details — full name, address, email, and phone number
• The insurer's name and your policy/claim number — found on your policy schedule or claim correspondence
• A clear description of the dispute — what happened, what your insurer decided, and why you disagree
• The outcome you are seeking — for example, payment of the claim in full, a revised scope of repairs, or compensation for delay
• Your IDR response — a copy of the written response your insurer gave you at the end of IDR
• Supporting documents — photos, contractor quotes, the policy Product Disclosure Statement (PDS), your claim correspondence, any assessor reports, and any independent assessment you have obtained

AFCA's process moves through several stages. Not all complaints proceed through every stage — many are resolved early.

• Registration and initial review: AFCA registers your complaint and carries out an initial assessment to confirm it is within their jurisdiction. They may contact you or the insurer for clarification.
• Referral back to the insurer: AFCA usually refers the complaint to the insurer first and gives them a short period to resolve it directly with you. Many disputes are resolved at this stage.
• Casework and negotiation: If the complaint is not resolved in the referral stage, AFCA assigns a case manager who facilitates negotiation between you and the insurer. Both parties submit their positions and supporting evidence.
• Conciliation: AFCA may conduct a conciliation — a structured discussion aimed at reaching a negotiated settlement. This can be by phone or video conference.
• Decision: If conciliation does not resolve the dispute, AFCA makes a formal decision. Decisions are binding on the insurer if you accept them (you are not required to accept a decision). Insurers can only appeal a decision on very limited procedural grounds.

Timeframes: AFCA aims to resolve most complaints within 30–60 days for straightforward matters. Complex disputes — particularly those involving large property claims with expert evidence — may take six to twelve months. AFCA publishes average handling times in its annual review.

AFCA's published annual review data shows that general insurance complaints — particularly home building and contents insurance — are consistently among the largest categories it receives. The most common reasons property insurance disputes reach AFCA include:

• Denial without adequate reasons: Insurers are required under the Insurance Contracts Act and the General Insurance Code of Practice to provide written reasons for a claim denial. Where reasons are not given, or are vague or inconsistent, the denial is vulnerable to AFCA review.
• Scope disputes and inadequate repair offers: The insurer accepts liability but the scope of works or the quantum offered is disputed. This is particularly common after major natural disasters when insurer-managed repair networks are stretched.
• Unreasonable delay in assessing or paying claims: The General Insurance Code of Practice sets maximum timeframes for claim decisions. Where insurers exceed these without adequate justification, AFCA can order the claim be decided and may award interest or compensation.
• Application of exclusions the policyholder disputes: Common exclusions disputed at AFCA include wear and tear, gradual deterioration, pre-existing conditions, and the maintenance exclusion. AFCA examines whether the exclusion was correctly interpreted and applied.
• Non-disclosure and misrepresentation decisions: Where an insurer refuses to pay based on non-disclosure or misrepresentation, AFCA examines whether the insurer has met its obligations under the Insurance Contracts Act before voiding or reducing the claim.

Where AFCA finds in favour of a complainant, it can make a range of orders against the insurer. Understanding what remedies are available helps you frame the outcome you are seeking when you lodge.

• Payment of the claim: AFCA can order the insurer to pay the claim amount in full or in part, up to the monetary limit applicable to your complaint type. For property damage claims by individuals, the limit is currently $1,085,000.
• Performance of the policy: AFCA can order the insurer to carry out repairs or restoration work rather than making a cash payment — which may be appropriate where the insurer agreed to manage repairs but has failed to do so adequately.
• Interest on delayed payments: Where the insurer unreasonably delayed paying a valid claim, AFCA can award interest on the amount owed for the period of delay.
• Compensation for non-financial loss: AFCA can award compensation for distress, inconvenience, and other non-financial loss caused by the insurer's conduct. This is subject to a separate compensation cap of $5,500.
• Refund of policy premiums: Where a policy was incorrectly voided or cancelled, AFCA can order refund of premiums.
• Correction of insurer conduct: AFCA can order the insurer to take specific remedial steps — for example, to provide a proper written reasons letter, or to reinstate a cancelled policy.

AFCA decisions are binding on the insurer if you accept them. You are not required to accept an AFCA determination — you retain the right to pursue the matter through the courts if you do not accept AFCA's outcome.

One of the most effective ways to strengthen an AFCA complaint about a scope dispute or inadequate claim offer is to obtain an independent assessment of the damage and the cost of restoration from a qualified contractor.

An independent scope of works provides AFCA with a technically credible alternative view of the required repairs and their cost. It is particularly valuable where the insurer's assessor and your own view of the damage differ significantly. AFCA can and does prefer independent evidence over insurer-engaged assessors where the independent evidence is well-documented and credible.

The Disaster Recovery platform connects property owners with IICRC-certified restoration contractors who can provide professional scope of works assessments. These assessments are itemised, transparent, and prepared by contractors who understand the insurance documentation process. Obtaining an independent scope before or during your AFCA complaint gives your position a factual basis beyond your own account of the damage.

This guide provides general information only. It does not constitute legal advice. For complex disputes involving large amounts, consider consulting a lawyer or public loss assessor who specialises in insurance claims.